Yesterday I bought some ATM calls on the Dax, but half expecting a trap after the fast run up I was not as aggressive as i should have been.
Nevertheless, I held a basically flat p/l for most of the morning, but with very little happening when I got to the hedge of the average trading window (i.e. time based stop) I closed out the position. Surprise, after I came back to the screen 1 hr later, the Dax had gone from 5850 to 5910.
Disappointed and somewhat angry at myself for not holding on for a bit longer, I closed the computer and called it a day.
Today though, more coolly I see that I acted in exactly the right manner:
>> Bought on the signal- no ifs or buts, even though there had been a fast run up in the last week
>> Closed position at the time stop , after market had done nothing to show possible strength
So it didn't pan out, but I did not lose either, and the time stop is there so that I get out of those positions where the market is likely to go the wrong way.
Now we are right in the middle of the range, no signal as yet.
Favourite play would be for a quick rally to take out the highs from yesterday, then stats print giving me the chance to buy a number of OTM puts to keep for a few days. Should see another set up by this afternoon, or tomorrow morning at the latest.
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