As you know by now, the Christmas online sales were great, shooting up by 3.4%, a testimony for the red hot booming economy thanks to Trump's super business-friendly policies. By the way, I still hear some pigheaded leftist talking heads claiming that the current US economy booming is due to Obama's economic policies. How laughable, isn't it?! When people got some strong opinions, they would just fool and blind themselves regardless how wrong they are. That's OK with me as long as I won't be fooled!! 😇😎
Of course, when people get more money in their pocket, they spend more. This is especially true in the US. Actually they will spend more in generally for Americans by borrowing more. So it is great news for retailers in generally, but especially for e-commerce like the giant Amazon, which shot up nearly 5% on Thu after the news breaking out. Great for Amazon but the problem for me was I was shorting Amazon with a bearish call spread due for today. Ouch!! I opened this trade last Friday when its TA suggested Amazon could be struggling in the near term. A bad trade indeed to start with. But here is the thing as I have said from time to time: For investing and especially trading, one has to be flexible and change his mind when facts are changing. I was clearly wrong by betting bearish for Amazon with the great sales data just coming out, so why should I stay with my short position like those pigheaded people who never change their mind regardless of the facts? Not me for sure. So I closed my short arm quickly after yesterday's opening. Glad I did so as Amazon was red hot with the news and just kept going up without looking back. After just an hour or so, I locked in a net profit for a double for a trade which would have been a totally loss for me.
Retrospectively I was too nervous and was way too early to lock in the profit! If I just let it run for a while, I could easily make 4 times more money than "just a double". But I have learnt in a hard way many times before that a successful trader should never be too greedy in taking profits, especially for options. No one can consistently buy at the exact bottom and sell at the exact top. For my options expiring in just one day, I could easily see my profit being wiped out if the tidal wave suddenly changed for Amazon and potentially I could see double loss for my trade. That's not the sensible way to speculate in the market. I'm happy with a double for a week although I missed the 4 bagger in hand.
Just for fun, here is the gain I could have made if not locked in too fast, 400% with nearly $20K from the long arm by closing yesterday. And it would have been 600% gain by this morning when AMZN shot another $30 up (although it gave back all and some by closing). Of course this kind of gambling is dangerous and it can quickly wipe out potential gains and turn to big loss easily. Don't feel sorry just because your gain is not at its maximum but be happy as long as you can make some money at least!
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