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BookingAlpha Option Trading Advisory

Sunday, May 26, 2013

Weekend Portfolio Analysis (05-26-2013)

SPX went from 1665.71 to 1649.60 for a -0.97% decline. A new trade was entered on Thursday using RUT Put options in June expiration and now there are two Iron Condors in June, which I'll talk about later and no position in the July cycle yet.

SPX chart as of Friday close

(Click on image to enlarge)
Stochastics at 35 neutral
McClellan at -124 neutral
60.19% are above their 20 SMA (neutral but close to overbought)
68.89% are above their 50 SMA (neutral but close to overbought)

To me this is no man's land here with decent room to move either way. I wouldn't open aggressive credit spreads at this point.

The 1590-1600 area should offer support on the way down, and below that is the 1540-1550 zone. I believe we won't get down there, but I think a visit to below 1600 this year is in the cards. Of course,.....with my shitty performance this year, it doesn't matter what I say or what anybody else thinks for that matter. Market timers, hedge funds etc have had it very hard this year, and the dumb money and mutual funds are winning the battle. We are quickly approaching the summer, historically a weak period for the markets and we'll see if the unstoppable up trend will continue.

June Positions

SPX 1540/1545/1715/1720 Iron Condor
Looking very healthy here and with an 80.08% probability of success. 66 points of upside cushion and (+4%) and 104 points of downside cushion (-6%). 26 days to go till expiration.

RUT 905/910/1025/1030 Iron Condor
Not too bad at this point, but definitely riskier than the SPX Iron Condor. 73.50% probability of success and a +4.5% upside cushion. Because RUT is usually more volatile, this +4.5% upside cushion looks to me less comfortable than the 4% room I have in SPX.

Action Plan for the week

Hopefully close the 1025/1030 side of the RUT Iron Condor, for a small win or a scratch. Definitely want to remove that risk. Other than that, It's time to start looking at July positions. So, I might enter a July Iron Condor late in the week.

Economic Calendar

Fairly light week with more weight on Thursday

Markets closed on Monday
Wednesday - German Unemployment and German CPI
Thursday - Initial Jobless claims, US GDP, Pending Home Sales
Friday - Personal Spending, Chicago PMI, Michigan Consumer spending

Good luck this week folks!

Check out Track Record for 2013

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  1. Hey buddy good luck with the IC on the RUT. I think you positioned well. If the RUT breaks 950 you might need to adjust. I'm short 1740/1750 june spx bear call spread for $0.80 looking to close out this week.

  2. Thanks buddy. Time will tell. So far this year all the trades have looked comfortable at the beginning and you see what have happened. Your SPX Spread does look indeed very decent. How many days before expiration did you open that one?

    Thanks for the comment!