 What's up trade hackers welcome to today's update today's Tuesday, May 26th Hope everybody had a great long Memorial Day weekend back in action first trading day of the week Starting with the trade hacker question of the day got this question in our community today What's the difference between double calendars and double diagonals? Let's go to the platform and take a look at an example to help explain What the difference is so we're looking at SPY and Let's start with the double calendar. So for on the trade tab, and I'm just choosing some Explorations here so like the three in the sixth day for example, you're always going to be selling the front week With shorter duration and you're buying options in a further dated cycle So let's just use the the options with three days and six days to expiration simply open that up and Choose some out-of-the-money options. So let's just choose the 30 ish Delta 33 we're talking about the 302 strike. So we're gonna buy Go to double diagonal and then double calendar. So you got to hit that drop-down and hit double calendar And then what we're gonna do so it automatically populates the next expiration cycle Then we can choose a similar Option on the put side so about the 35 Delta so the 297 puts so we can choose 297 put here and a 297 put here so We take this over the analyze tab and I'll help you understand what I'm doing So basically what we've done is in these shorter duration in these three-day options may 29th We are selling these okay, so we're selling those and then in the further dated options We are buying those okay, but our calls are The same so you've got the 302 call You've got the 302 call in both expirations on the put side You've got the 297 put and the 297 put so with a calendar spread or in this case a double calendar spread Your puts are the same in both expiration cycles and your calls are the same in both Expiration cycles okay, so or if you do a single calendar your your strikes are the same in the front week as they are in the back Week so that's a double calendar now if we go and check out a diagonal Let's use the same expiration cycles But all we're doing is you know with the calendar spread we're using the same strikes with different expiration cycles and in the Diagonal spreads we are using different strikes and different expiration cycles Okay, so let's set one of those up so we're gonna use the same start with the same 302 We're gonna buy a double diagonal and choose double diagonal Okay, and then we're gonna go. Let's go to the same one the 297. That's the 297 put okay, so we'll do the 297 Put here in the front week But then we can go out to the next expiration cycle and choose different ones So if we go to the June one, you know, let's say you wanted to use a lower delta So instead of you know that same strike. Let's go down here and use say the 306 on the call side So the 302 we use the 306 and Then on the put side same thing. Let's go down and use the 290 as an example Yeah, 290 there you are and then let's take this over the analyze tab and check out the difference Okay, so remember here's the here's the calendar spread. It's gonna be pretty balanced and equal kind of a delta neutral trade to start out with Whereas the the diagonal is a little bit different where you know depending on the strikes you choose Let's say you like the idea of the calendar spread, but you wanted more upside You know if the stock move higher where you're willing to take the risk on the downside now This is a pretty dramatic situation here. We wouldn't actually place a trade like this necessarily But you can play around with the strikes and the main difference Like I said is with the double calendar You're using the same strikes in different expiration cycles and with the diagonal you're using different strikes and Different expiration cycles. So hopefully that helps a little bit You can play around with those to kind of figure out the the strategy that you're that you're trying to accomplish Based on your overall assumption All right, let's go to the Charts and see what's going on in the overall market now the SNPs are up 36. They were up quite a bit more They were up as much as 50 some and they're coming down now the market still has about 10 minutes 11 minutes before it closes So we're seeing a little bit of downside action here late in the day Even though the market still up decent SNPs up 35 Dow up 52 Nasdaq is down 24 and the Russell's up 37 so what's going on with with the different sectors today? Well, banks are up big. I mean you look at Bank of America is up over 7% City is up almost 10% Capital one financial up almost 10% so big move higher in the banks Small caps obviously up higher as well with the Russell leading the way up, you know 2.6 plus percent where the Nasdaq is actually down. So tech is actually lagging So we've got banks up, you know travel stocks are up if we look at some of the airlines Delta airline Delta's up 12% You know Expedia is up 6% You know some of these other airlines up huge so big moves to the upside in travel looks like everybody Weather's getting warmer people are looking to travel. Does that mean stocks are going up? Well today does but not necessarily so we've got a travel up banks up Tech is lagging kind of down to neutral and then you know It's kind of a mixed bag between between everything else depending on the depending on the stock So interesting stuff. We look at it a chart of just the S&P, you know We're still in a pretty range bound little box I mean it looked like maybe it was gonna break out to the upside and you know, it still possibly could You know, but we're still in this range. We're not we haven't really moved much So we'll see what happens obviously Nasdaq kind of the the lager today And it was popped up earlier, but it's come back down is actually read on the day Nasdaq is is not quite as flat but more of a you know, it's got kind of a an upward sloping channel As opposed to straight across like the S&P so I'll be interesting to see what happens here We kind of hitting the top and we're gonna roll over or is this thing really gonna make a run back to new highs I don't think new highs is in the cards, but I've been saying that for a while now So you know that opinion on us and Well, but we'll see what happens, you know anything is possible the market can do anything at any time It can stay irrational can be unreasonable No matter what kind of fear you might be seeing in the market No matter what the media headlines say the market can do anything So you want to have a strategy you want to stay mechanical Based on what you're doing and so that's what we've done and what did we do today? We added a piece in gold took some profits on another piece We added a position in the S&P and We are just letting some of our other positions continue to work. We've got a decent amount of short Delta So we're definitely playing for some downside, but we're not way over short by any means We've got a pretty balanced portfolio with some extra short Delta So we will definitely benefit from some downside, which is what our assumption is, you know Over the next couple months, but we're still gonna stay mechanical and keep doing our thing One other thing I wanted to mention was Earnings not much earnings as far as the stocks that we trade this week I mean, obviously Memorial Day was Monday. Nothing there Tuesday, you know, nothing exciting Wednesday Nothing exciting really the only stock that we trade and we trade some of these others just Every once while but you know cost goes a good liquid big stock that we would trade So that's really the only major one this week and that's Thursday After the close so not sure we'll put on a trade there But we'll check that out on Thursday before the market closes to see if we see an opportunity If you guys have any questions feel free to drop us at a line in the community a community dot navigation trading comm see there