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Sunday, December 25, 2016

Weekend Portfolio Analysis (December 25, 2016)

Boredom is king now as evidenced by a week where the S&P started at 2,259.24 and finished at 2,263.79. We may never see significant moves in the markets again. Kidding. Of course we all know at some point in 2017 volatility will be much higher than it is now. We may have one more slow week ahead. So, find something productive to do.

Recent Trading Activity

- Initiated a February RUT Iron Condor (1200/1210/1470/1480) with additional IWM Puts as hedge during this very low volatility environment. That was all my activity and it took place on Thursday.



Market Conditions 
(Click on image to enlarge)
Stochastics: 52 (neutral)
McClellan: +30 (neutral)
Stocks above their 20 DMA: 60% (neutral)

No man's land territory.
With super low volatility it is obviously not the ideal time to be selling options. Time to lower expectations and play it smaller than usual or perhaps invest some money in Put options. Main indexes still uncomfortably far from its main moving averages.


Russell:
(Click on image to enlarge)



Current Portfolio

DEC30 SPX 2140/2150 Credit Put Spread
$660 credit. 2 deltas. Expires this upcoming Friday.

JAN RUT 1480/1490 Credit Call Spread
$1,200 credit. 4 weeks to expiration and only 3 deltas. No concerns.

JAN SPX 1370/1375 Credit Call Spread
$1,600 credit. 4 weeks to expiration. 3 deltas. No concerns.

FEB RUT 1200/1210/1470/1480 Unbalanced Iron Condor hedged with IWM 126 Puts
New position, lots of baby-sitting ahead. Obviously no concerns for now.


Action Plan for the Week

A very simple plan this week,

- No new positions unless we quickly reach an oversold extreme, in which case I will be selling SPX Credit Put spreads with January expiration.

- Let the  DEC30 SPX 2140/2150 Credit Put Spread expire for max profit on Friday morning.


Forex
The LT Trend Sniper system finally closed its short Gold position  (via XAU/USD symbol)

It was in the end a nice play that began on November 14 at midnight (GMT+2 broker's server time) and lasted until December 23. So, 39 days holding that bet from $1,224 to $1,129. Ninety-five cool Gold points. This bet was made risking 3% of the portfolio with a Stop Loss distance of 44 points. The winning trade alone, brought a portfolio gain of +6.75% and the LT Trend Sniper is now up +4.77% for the year, easily beating Barclay's Currency Traders Index benchmark (+1.77% as of this writing in 2016).

A short re-entry will take place any time if Gold closes a session below $1,127.75. Long entries, nop. That won't happen in a while.
 

LT Trend Sniper is also short the Euro. Not much progress was made this week but the trade is still open. Stop Loss has now been moved for the third time and the risk in the position is only 0.75% of the portfolio. Next SL move will be to break-even.

For those who have asked me about the results of the Sniper trade by trade, it is all here. Just scroll-down to the very bottom of the page.



Economic Calendar

Tuesday: CB Consumer Confidence.
Wednesday: Pending Home Sales.
Thursday: Crude Oil Inventories.


Options Trading results: +4.52% for the year (S&P benchmark: +10.76%)
                                         Portfolio 59% invested, 41% cash.

Happy Holidays folks!
LT


If you are interested in a responsible and sustainable way of trading options for consistent income with solid risk management, consider acquiring LTOptions, my options trading system to the last detail.

Check out 2016 Track Record


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