Recent Trading Activity
Market Conditions
(Click on image to enlarge)
Stochastics: 29 (Neutral. Down from 74 last week)
McClellan: -24 (Neutral. Down from -12 last week)
Stocks above their 20 DMA: 55% (Neutral. Down from 59% last week)
No man's land
For the second week in a row all three oscillators went down. In the previous analysis this prompted me to favor some downside bias, as all three had gone down while price hadn't. So, there was an incipient bearish divergence. The move was almost 1 percent down this week and we are far from oversold.
I think there's decent support in this market and we're seeing that down moves can barely be sustained to become more serious. We're also entering the summer months, which are usually slow, low volume (boring) until September. I'm looking at the lower red diagonal as support, pointing to around 2,670 for this week. That would be an oversold environment and it would take more significant fear to go lower than that.
The Russell Index:
(Click on image to enlarge)
RUT a little weak the last couple of days, yet it had overall a better week than the SPX.
Action Plan for the Week
- Defend the RUT Elephant's Call side (by just closing it) if RUT rallies past 1,710
- Initiate the first August position on Monday. My candidate right now is to deploy an SPX Elephant. As usual, I'll be following the Elephant guidelines described on LTOptions.com.
Economic Calendar
Monday: US New Home Sales.
Tuesday: US Consumer Confidence. A couple of FOMC members speak.
Wednesday: Durable Goods. Pending Home Sales.
Thursday: EU Leaders Summit. US GDP.
Friday: EU Leaders Summit. Europe CPI. Chicago PMI, Michigan Consumer Sentiment.
Trade with confidence my friends,
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 2018 Track Record
- No Activity.
Market Conditions
(Click on image to enlarge)
McClellan: -24 (Neutral. Down from -12 last week)
Stocks above their 20 DMA: 55% (Neutral. Down from 59% last week)
No man's land
For the second week in a row all three oscillators went down. In the previous analysis this prompted me to favor some downside bias, as all three had gone down while price hadn't. So, there was an incipient bearish divergence. The move was almost 1 percent down this week and we are far from oversold.
I think there's decent support in this market and we're seeing that down moves can barely be sustained to become more serious. We're also entering the summer months, which are usually slow, low volume (boring) until September. I'm looking at the lower red diagonal as support, pointing to around 2,670 for this week. That would be an oversold environment and it would take more significant fear to go lower than that.
The Russell Index:
(Click on image to enlarge)
Current Portfolio:
The SPY Calls and SVXY Calls expire in December and January of next year. All bullish bets on a market rebound.
Let's now look at the income plays.
Jul. SPX/SPY 2490/2500 - 255 Put side of Elephant
Net Credit: $1,057. Four weeks to expiration.
(Click on image to enlarge)
Defense
lines: 2,565 to the downside (adjust Put side).
Jul. RUT/IWM 1570/1575/1745/1750 - 159/175 Elephant
Net Credit: $1,684. Four weeks to expiration.
(Click on image to enlarge)
Defense
lines: 1,615 to the downside (adjust Put side). 1,710 to the
upside (close Calls at a loss, keep riding Put side, which has a credit
that is greater than the Call side loss.
Let's now look at the income plays.
Jul. SPX/SPY 2490/2500 - 255 Put side of Elephant
Net Credit: $1,057. Four weeks to expiration.
(Click on image to enlarge)
Jul. RUT/IWM 1570/1575/1745/1750 - 159/175 Elephant
Net Credit: $1,684. Four weeks to expiration.
(Click on image to enlarge)
Action Plan for the Week
- Defend the RUT Elephant's Call side (by just closing it) if RUT rallies past 1,710
- Initiate the first August position on Monday. My candidate right now is to deploy an SPX Elephant. As usual, I'll be following the Elephant guidelines described on LTOptions.com.
Economic Calendar
Monday: US New Home Sales.
Tuesday: US Consumer Confidence. A couple of FOMC members speak.
Wednesday: Durable Goods. Pending Home Sales.
Thursday: EU Leaders Summit. US GDP.
Friday: EU Leaders Summit. Europe CPI. Chicago PMI, Michigan Consumer Sentiment.
Trade with confidence my friends,
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 2018 Track Record
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