Don't try and Catch a Falling Knife

I made my first post about trading options on Wednesday in my micro options account. You can read about the first trades I made here. The rest of this post will be about the rest of the positions I opened this week and so that we can track how they perform in the future. My goal is to summarize all of my trades until there are too many for us to track. In my first week of trading I made my first huge mistake and broke the rules. I made an out sized trade for my account and messed up. Man it sucked but it was a great learning experience.

So, yesterday I made my first huge mistake in my option account. TSLA opened down 5% and I thought I could sell a put spread with the 1 DTE weekly. The trade seemed like a slam dunk. I collected $94 for $250 risk selling a 260 Put and buying a $257.50 put. TSLA blew through the strikes and never came back. I ended up closing the trade this morning for $237 for a $143 loss. Luckily, I didn't blow up my account and will live to trade another day. The $250 of risk was way too large for my micro options account. There is a term in the options world don't try and pick up pennies in front of a steam roller, well I did, and I got crushed. See the charts and options chain below.

Today, I put on a March 17 Iron Condor in WalMart. My short call at $72.5 and my short put at $70 I went $1 wide with my wings. For that I brought in $51 which I think is a great risk reward trade off. The trade skews bearish on Deltas and that is partly by design the WalMart chart looks like it is setting up for a pull back. Since it is shorter duration I should see Theta come in and start working for me. Below is the chart and trade for the Walmart trade.

The last trade I got watching tastytrade this morning. A woman called in and had put in long put spreads on JNJ. The chart shows a bearish pattern but the stock has gapped up with no pullback. I got into the trade for a $34 debit. I went long the $115 April 21 put and short the $110 put. The stock is a $122 but we should see some consolidation from that level because the stock has moved straight up. If this trade goes in my favor it stands to really help my account with a max profit of $466. Below you can see the char and trade on JNJ.

 On my earlier trades they are all going fine. GM tested my short put this morning, but has moved back above it. The other trades are moving like they are supposed to. I still have $120 in option buying power, I am going to keep an eye on my trades for now hopefully collect some profits in the mean time. Hopefully, there will be some more compelling trades like the Walmart and JNJ come soon. My portfolio currently has a -6.08 Delta and 1.05 Theta.

Thank you for reading and as always I look forward to getting some feedback.