CSP Updates for Friday, Sep 28

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Administratia:

If you have been a prior benefactor of my Twitter CSP alerts you know that your alerts have been quiet since 9/26.  This is because my subscription with Zapier to link TradeStation email alerts to Twitter has hit the maximum allowed under their free plan (100 alerts per period).  They want $240 ($20 / month payable in a yearly traunch) for 1,000 alerts per month, which is far more than we will need.

Review the past alerts by going to my Twitter alert account and judge for yourself whether this is or can be valuable to you as you navigate the CSP/CC world:  https://twitter.com/GreekGodTrading 

If you want the alerts restored then I need to collect a total, from all folks, of $240.  10 of you means $24/year - $2 per month.  5 of you is $4/month.   You can Venmo it to me here or via Paypal at pduncan@vt.edu.  If I do not receive enough monies I'll return your payment to you, less any charges (if there are any).  I'm certainly not looking to make any money from you -- I just want expenses covered for a service I provide for free (-ish) and that many of you have expressed that you receive benefit from.

If you are asking why I don't simply pay for it the answer is easy -- I already have the alerts.

Let your conscience decide what you should do.  For the few that have sent a few bucks -- thanks.  We'll see if we reach critical mass.

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Multi-timeframe uptrending stocks and ETFs have been updated for the open on Friday, September 28th, and are available here ( https://goo.gl/XZKgwY ).  The archive subfolder contains historical lists that you can review back in time and see how they would have performed going forward.

The alerts files (monthly historical as well as the alerts generated today, after market open), are available here (https://goo.gl/WbuJhS ).  The archive subfolder contains historical alerts files that you can review.

Real-time Q&A with me, if I'm available, is through this link:  https://discord.gg/4QAUqyd This is Dr. Jeff Scott's HGSI Discord forum and it's worth your time to join (free).  I am @PaulDuncan at Discord and I typically watch the #cashsecuredputs-n-coveredcalls channel.  Come say "hello"!

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Premarket Alerts:

The following options are signalling a need for further review in this morning's premarket.  The opportunity that is available in these is due to higher-than-normal bid/ask premium availability, and will most likely vaporize after the open (markets are efficient).

WWE 181019P90

DXCM 181019P135

NBIX 181019P115

BPT 181019P30

CURE 181019P62

EVH 181116P25

I note that some of these options and underlyings were extremely active yesterday.  Here are the options that alerted yesterday (available in the alerts file that is linked above):

ALGN 181005P370

ALGN 181012P370

ALGN 181019P370

BPT 181019P30

BPT 181116P30

DXCM 181019P135

EVH 181116P25

MPC 181005P80.5

NBIX 181019P115

NFLX 181005P360

NFLX 181012P360

OILU 181019P57

OLLI 181019P90

SGEN 181019P75

SQ 181005P90

SQ 181012P90

SQ 181019P90

SQ 181026P90

TECL 181019P154

TQQQ 181005P66

TQQQ 181012P66

TQQQ 181019P66

WWE 181019P90

For some of these to continue for more than a day means juiced value in the option chains and as such, the underlyings are worthy of further research.

As usual, these are not recommendations to sell premium - do your homework.

Evaluating the Quality of the Alerts

A question came in last night asking how to evaluate the alerts.

A link for the alerts was provided at the top of this blog entry ( https://goo.gl/WbuJhS ).  Within that folder you will see a file "Sept_2018_Master_Alerts" or, if you're reading this after September, probably the month that we're currently in.

Copy that file to your machine.

Open it up.  The right-most column lists the option expiration date.

Pick the date you are interested in.  Since today is OE (9/28), when I use all the alerts generated for 9/28 within September (as of close of 9/27) I get the following option symbols and the first date of the alert:

9/13/2018 ADBE 180928P252.5

9/20/2018 ALGN 180928P360

9/18/2018 ALGN 180928P370

9/26/2018 ALGN 180928P375

9/24/2018 BBY 180928P76

9/24/2018 FAS 180928P71

9/24/2018 FAS 180928P73

9/24/2018 FFIV 180928P190

9/13/2018 FIVE 180928P125

9/14/2018 GRUB 180928P136

9/24/2018 HES 180928P70

9/11/2018 JDST 180928P80

9/14/2018 KMX 180928P75.5

9/13/2018 KMX 180928P76

9/6/2018 LITE 180928P60

9/21/2018 LNG 180928P65

9/18/2018 MOMO 180928P45.5

9/17/2018 NOW 180928P190

9/7/2018 PTCT 180928P41

9/6/2018 SQ 180928P80

9/12/2018 SQ 180928P85

9/17/2018 SQ 180928P87

9/25/2018 TQQQ 180928P66

9/24/2018 UCO 180928P33

9/24/2018 ULTA 180928P267.5

9/24/2018 UPRO 180928P55

9/24/2018 UPRO 180928P55.5

9/24/2018 XLNX 180928P75

9/25/2018 XLNX 180928P76

Presume you sold the contract the minute the alert was issued.

Now, take each option symbol and review the chart for the option symbol, and ask yourself the following:

• 1) Did the option symbol touch $0.10 or $0.05 any time during the period from the original alert to today?  If the answer is yes, and you understand how to place a buy-to-close, good-til-cancelled order, then you made money.
• 2) If the answer to 1) is "no", then look to see if the underlying is going to close today above the strike price of the option.  If the answer is "yes", then you made money.  
• 3) if the answer to 1) and 2) are both "no", then you must either make the decision to roll today (or prior to today) or allow yourself to be assigned.  If the option underlying is a quality stock, then being assigned is not a bad thing because you can write a call against the stock position and further collect money.

So, as an example, the following symbols have touched $0.10 or below in the month of September:

SQ 180928P80

SQ 180928P85

SQ 180928P87

ULTA 180928P267.5

XLNX 180928P76

ADBE 180928P252.5

BBY 180928P76

LNG 180928P65

UCO 180928P33

FFIV 180928P190

TQQQ 180928P66

HES 180928P70

FIVE 180928P125

UPRO 180928P55

This means you would have closed out of the position with a buy-to-close order and would have pocketed 80-90% of the original premium, less the BTC and commissions.

This also means the following option contracts are still open:

ALGN 180928P360

XLNX 180928P75

ALGN 180928P370

GRUB 180928P136

LITE 180928P60

ALGN 180928P375

NOW 180928P190

UPRO 180928P55.5

FAS 180928P71

JDST 180928P80

MOMO 180928P45.5

KMX 180928P75.5

FAS 180928P73

KMX 180928P76

PTCT 180928P41

The underlyings, as of premarket this morning, are as follows:

ALGN 389.97

FAS 70.60

GRUB 139.50

JDST 82.50

KMX 73.00

LITE 61.00

MOMO 43.77

NOW 191.06

PTCT 47.06

UPRO 56.87

XLNX 79.85

Here is what this means going into OE today:

ALGN is WELL above $360 so will be out-of-the money (OTM).  Expire worthless = collect all.

FAS is just below $71, so you may be assigned, maybe not.  It looks to pin close to $71

GRUB is most likely going to close OTM ==> expire worthless

JDST is OTM this morning

LITE  is OTM this morning

MOMO is ITM this morning and may be assigned.  Good stock, sell a CC.

NOW is OTM this morning

PTCT is well OTM this morning

UPRO is OTM this morning

XLNX is OTM this morning

So, out of all the of the options that expire today, the real risk going into the open is FAS and MOMO -- every other option will expire worthless by the end of the day (OTM) or already has triggered the BTC (buy to close) order.

Remember:  my strategy has a 93% win rate.

Rinse, repeat.

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That's all for now.  If you have questions -- ask.

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As with all my ramblings, you are responsible for your own actions and I am not.  Nothing I've written here is advice to buy or sell any security, so don't do it unless you absolutely take ownership for your actions.

Regards,

Paul