All is going well over here in LazyTradingLand. The market has been benevolent so far in 2015 without keeping sustained violent moves in the same direction. This is great because if you are conservative you haven't felt its heat yet. I haven't had losing trades this year and I have basically traded stress free. I'm not showing off my awesome abilities. The market has simply behaved in a way that easily accommodates our trading strategy. It will eventually get ugly again, we just don't know exactly when. So, let's enjoy the party, the orgy of capital easily flowing into our accounts.
The SPX Index went from 2064.87 to 2102.06 for a +1.8% gain. The index is now up 2.10% for the year.
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McClellan: +71 (neutral)
Stocks above their 20 Day Moving Average: 62% (neutral)
Still no man's land. Because the market has been going up and down without sustained convincing moves, we have had very few instances of short term extremes this year. Well, no man's land again this weekend for our viewing pleasure. Although certainly closer to an overbought extreme than to an oversold one. 2% higher from here, around SPX 2140 would be a good time for selling Calls. One thing that caught my attention was the fact that even though the market went up 1.8% this week the number of stocks trading above their 20 Day Moving Average went from 64% down to 62%. Funny bearish divergence right there. To sum up, not a good time for selling credit spreads. I'll keep waiting. Patiently, like the cheetah waiting for its injured calf.
SPX 1855/1860/2200/2205 unbalanced Iron Condor
1 week to expiration and 99% probability of success. It will expire worthless this week. This is the only April position and the year to date performance of the portfolio (after trading costs) will be +9.44% by this time next week. Nice for the small amount of work we have done this year.
RUT 1100/1110/1330/1340 unbalanced Iron Condor
5 weeks to expiration, 86% probability of success. No sweat here. No threats in the short term horizon.
Action plan for the week
None of the existing positions will be threatened this week. The April one will expire yielding max profit.
As for new trades, I'm not done with the May expiration cycle. If we reach a market extreme I will default to May options for a credit spread against the prevailing trend. I still like the idea of a May 2210/2215 Credit Call spread for 0.50 credit or better. But for that I need for SPX to go up to about 2140. A short term oversold extreme is farther and I believe it is unlikely to be reached in a week.
As for June positions, we're still too far for my liking. I will enter the first June position in around two weeks.
When it looked like the Euro was consistently on its way to recovery, it rained shit in Europe again. The Euro posted massive losses this week, shedding almost 5 cents vs the American Greenback.
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LT Trend Sniper will enter a short Euro position. It will be its third trade of the year. The robot is up +17.52% year to date, independently verified by MyFxBook here.
Sunday: China's Trade Balance
Tuesday: US Retail Sales and PPI. China's GDP and Industrial Production.
Thursday: US Housing starts and Building Permits. Philly Fed Index.
Friday: European and American CPI numbers. Michigan Consumer Sentiment
Good luck this week folks!
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Check out 2015 Track record