SPY Position Update
SPY closed at $139.35 on Friday

The August 1st Couch Potato published an August expiration month SPY bear call spread (see tables below)

SPY Risk Analysis
We have not yet had the opportunity to open an August put spread, therefore the only risk is the SPY continuing to move up and threatening the $141 strike price call

TLT Position Update ---------------------------------------------------------
TLT closed at $127.42 on Friday – the August position is approx $1,000 in the black

The July 16th Couch Potato published an August expiration month TLT bear call spread
The call spread is approx. $1,000 in the black (see tables below)
$134 strike price short call delta is .1050 (89% probability this position will be profitable)

TLT Risk Analysis
We have not yet had the opportunity to open an August put spread, therefore the only risk is Treasury note prices rallying and threatening the $134 strike price call

GLD Position Update ---------------------------------------------------------
GLD closed at $155.55 on Friday – the August position is approx. $1,400 in the black

The July 17th Couch Potato published an August expiration month GLD bear call spread
The call spread is approx. $400 in the black (see tables below)
$160 strike price short call delta is .1754 (82% probability this position will be profitable)

The July 17th Couch Potato published an August expiration GLD put spread
The put spread is approx. $1,000 in the black (see tables below)
$148 strike price short put delta is -.0681 (93% probability this position will be profitable)

GLD Risk Analysis
The risk is GLD returning to recent highs and threatening the $160 strike price short call.

Exit Plan
Anytime the market maker is willing to accept a limit price of less than .11 on one of our short strikes, buy back all the short contracts and sell the long positions on the same spread. However, if it is a few days prior to the expiration date, we may be able to hold out for a .05 bid.

If one of our short strikes is penetrated (closing price above a short call or below the short put) AND the delta rises to .65 we will look to close out this spread (buy the short contracts, sell the long) and roll it out to another short strike price. Unless this is option expiration week, do not panic and rush to close the trade, many times the market will reverse itself and remove the sense of urgency. If one of our short strikes has been violated and there is no price reversal, we cut our losses and live to fight another day.

Happy Trading

Gregory Clay

Couch Potato Trader Disclaimer
All results reported in this section are hypothetical. While the numbers represented here may have been achieved or beaten by our readers, we make no representation that any individual investor achieved these exact results. The tracking for the plays listed in this section uses closing prices for the day the newsletter is published and it is not meant to imply that any reader actually received those prices (though many often do) or participated in these recommendations (even though many do). The portfolio represented here is hypothetical and for investment education purposes only. It is only an illustration of what type of gains a knowledgeable trader might receive utilizing these strategies. If you don't get close to these results, guess what. It isn't the fault of the strategies.