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Saturday, June 8, 2013

Weekend Portfolio Analysis (June 8, 2013)

From 1631.71 to 1643.38 the SPX index advanced this week rebounding beautifully off the lower end of the uptrend channel like in classic technical analysis books.
(Click on image to enlarge)
Stochastics 35 (neutral)
McClellan -127 (neutral)
46.80% of stocks above their 20SMA (neutral)
62.80% of stocks above their 50SMA (neutral)

This is no man's land folks and there is room to move in either direction. But on Wednesday and Thursday this past week all the stars were aligned to sell Put credit spreads which I did, with everything pointing oversold conditions and close to only 30% of stocks above the 20SMA.

I took advantage of that and closed the Call side (1025/1030) of the RUT 905/910/1025/1030 Iron Condor and also sold a RUT 890/895 July bull put spread betting on a rebound and I haven't had to regret it for a single second.

Although we are in no man's land I have a little short term upside bias thinking that the trend wasn't broken.


June Positions
SPX 1540/1545/1715/1720 Iron Condor
(Click on image to enlarge)
91.37% probability of success 12 days to expiration. I love it! Nothing to do here.

RUT 905/910 Bull Put spread
(Click on image to enlarge)
Yes, you know it! Beautiful. Very comfortable. Also nothing to do here 12 days to expiration.


July Positions

SPX 1505/1510 Bull Put Spread
With SPX at 1643 right now, this position is showing a 94% probability of success. No concerns at all.

RUT 890/895 Bull Put Spread
with RUT at 987 I have no concerns at all right now with this position.


Action Plan for the week

I feel very comfortable with my June positions, and won't touch them this week.

As for July, I have two Bull Put spreads and no Bear Call spreads, you guys know how much I dislike that. So, my most immediate goal is to get rid of one of them and also get to open a Bear Call spread. Hopefully I can do both this week. If the market rebounds, and goes higher another 1.5% - 2% I will close the RUT 890/895 Bull Put spread for profit and will sell an SPX Bear Call spread in July. That would leave a balanced risk both sides of the market and would eliminate my excessive downside exposure. Ideally I would like to sell the SPX Calls in the 1730 area. That's it, that's my whole plan.


On the Forex front

By the way the LT Trend sniper system is forecasting an uptrend in the EURUSD pair. Let's see if this is finally the homerun for this year. Recently MetaQuotes changed the way MT4's stations publish their stats to FTP Servers and there has been a lot of noise about it. Third party verification sites such as myfxbook.com stopped receiving stats and boy of boy did Metquotes put crap on their product this time! I don't even know how things are at this point and I don't know if my MT4 station will continue to automatically send trading stats to myfxbook as I haven't had enough time this week to find out. But just for your reading pleasure, read what a very respected Forex specialist thinks about this whole issue An open letter to Metaquotes - Why 2013 is the last year I plan to use your software.


Economic Calendar

As usual for the second week of the month, this will be a light week in terms of high impact news:

Wednesday - European Industrial Production and German CPI
Thursday - Retails Sales
Friday - European CPI, US PPI, Industrial Production

Good luck this week folks!


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