TSM Trade on Jan 19, 2021 15:47 from Marius: Tradervue User Stock Trades.

Markets opening after a 3 day weekend strong and with a bid. This is also happening globally and after China reported good GDP numbers the past weekend. Earnings season is kicking off and fundamental catalysts will be seen more.

Fundamental Analysis

Last Thursday TSM reported higher Q4 earnings, net sales, and issued Q1 targets. It was an overall bullish market reaction. Today there was a strong bid in SMH and looking into the components, it shows TSM as having the highest weight at 14.24% and on the 1Y it is the best performer in the ETF. It was also outperforming today with continued elevated trading activity today.

Quantitative Analysis

Intraday Fundamentals

RVOL 1.757
AVOL 11.638M
ATR 4.32
Short Float 0.28%
Shs Float 4.86B
Inst Own 19.10%
Market Cap 608.82B

Options Statistics + Tape Reading

SI 0.772
IV 47.45%
IVP 43%
P/C 0.374
VWAP 131.521

Continued elevated trading activity with higher call volume done on the ASK implying continued upside direction. Noting the large calls buys at the open.

(Tape recorded but not reviewed/uploaded)

Options Positioning

OI S 1,002 L 892
VOL S 1,064 L 63
Delta S -.05 L -.01
Theta S -.08 L -.04
Vega S .01 L .00
Gamma S .01 L .00
Prob T S 11.33% L 3.43%
Prob ITM S 5.74% L 1.74%
MMM +/- 5.017
IV Series 47.32%

Being a 3rd day play there was still elevated trading volume and activity. Still chose a short strike that made sense within my R/R parameters but now hedging it for downside action with a long call option. This will allow better risk management and capital allocation scaling with other trades.

Technical Analysis

Noting the IV picking up but within range of the last couple months and this is after ER. More volume done on the BID day one which led me to forego a long scalp trade. After seeing the EOW close and today's open for the week with price retracing the highs, the trade was back in play within my parameters.

Trade/Risk Management & Review

Trade and execution performed well. Starting to hedge and use spreads to manage risks where appropriate. This will be key to scale and place more trades simultaneously. Grading overall trade as an A. Need to work on possibly moving strikes in more ATM starting around a 10 delta and or where the levels makes sense.