12/19/18
The short squeeze is on. The bulls have taken back the market, and are punishing the shorts that have been initiated over the last 2 weeks. Stops from leveraged accounts are being taken out!
Today we are studying the ‘Fibonacci Retracement’ levels. We are picking the high from the large decline that started in mid-November ~$6,000 until the lows of late last week ~$3,200. As you can see in the chart, we have basically rallied to the 23.6% retracement level this morning. The 38.2% retracement level also looks to align with some resistance around ~$4,400 that had failed in a past short-term rally on Nov. 29th
We are not sure on the exact direction at the moment this morning, but these fast, choppy markets allow great opportunities to trade/scalp the spot underlying. Buying GAMMA, which means owning shorter term options that allow your DELTA position to change rapidly as the market ebbs and flows, allows you this freedom to GAMMA hedge/scalp your options position, picking entry and exit points through technical levels, and leaning on the momentum of the market to make some real profits. The challenge of this trade is to know when the market volatility slows, to sell out of these short-term options as their value will decay more rapidly as they come to expiration.
The short squeeze is on. The bulls have taken back the market, and are punishing the shorts that have been initiated over the last 2 weeks. Stops from leveraged accounts are being taken out!
Today we are studying the ‘Fibonacci Retracement’ levels. We are picking the high from the large decline that started in mid-November ~$6,000 until the lows of late last week ~$3,200. As you can see in the chart, we have basically rallied to the 23.6% retracement level this morning. The 38.2% retracement level also looks to align with some resistance around ~$4,400 that had failed in a past short-term rally on Nov. 29th
We are not sure on the exact direction at the moment this morning, but these fast, choppy markets allow great opportunities to trade/scalp the spot underlying. Buying GAMMA, which means owning shorter term options that allow your DELTA position to change rapidly as the market ebbs and flows, allows you this freedom to GAMMA hedge/scalp your options position, picking entry and exit points through technical levels, and leaning on the momentum of the market to make some real profits. The challenge of this trade is to know when the market volatility slows, to sell out of these short-term options as their value will decay more rapidly as they come to expiration.