April is quite a difficult month to trade. The bullish momentum has lost steam but the stock market is not exactly plunging at the moment. Things are choppy, so it is difficult to predict a single direction for profit. Thus, there is a chance that short term options contract may end up expiring worthless when the sideway momentum eats up all the time value in the contract.
Here’s sharing some of the trades that I made on 15 April 24.
[Trade 1] Bought 1 x Nvidia Share
While this may not be a trade, it happens because I need to cover the shortfall Nvidia share positions in my 2 x Nvidia SELL CALL Contracts.
Background of my Nvidia’s naked CALL disaster:
My Nvidia Time Bomb (-USD141.5k Unrealised Loss & Counting) | Why You Should Never Sell Naked CALL | The Danger Of Short Selling
So now I own 122 shares of Nvidia, still short of 78 shares to turn my naked CALL contract into a Covered CALL contract.
Details here: [15 April 24] Bought 1 x Nvidia Share
[Trade 2] Bought 1 x Tesla PUT
My excess liquidity dropped by more than $5k as Tesla share price dropped more than 4.8%. It is now at a precarious position of almost 25k.
So I made this trade to improve my liquidity by another 5k, using a capital of $1.1k as I have run out of shares to sell to increase my excess liquidity. This is one area that I need to watch very closely because when excess liquidity drops to zero, the brokerage will liquidate my share positions.
Details here: [15 April 24] Bought 1 x Tesla PUT
[Trade 3] Closed Tesla Covered CALL for a profit of USD199
Finally, some profits coming in for this difficult month as I took profit by closing my Tesla CC position when Tesla’s share price dropped almost 5% today. The strike price of USD170 may not be high enough for the contract to expire worthless on expiration date as Tesla may close above this SP when it rebounds. So, I took a small profit on this positon while I still can.
Trade Details: [15 April 24] +USD199 Profits, Closed Tesla CC Contract
[Trade 4] Bought 2 x Micron CALL Contract
Despite the lackluster performance of the whole semicon industry over the past 2 weeks, I thought Micron’s share price held up pretty well.
Thus, I added 2 more BUY CALL contracts into Micron to average down the price for my original 8 positions. I expect these positions to become profitable after earnings are reported and bullish momentum returns in mid year. Having said that, I am also mentally prepared for max loss of USD1.88k.
Details here: [15 April 24] Bought 2 x Micron CALL contacts
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