Today's market movement had most non-directional traders' heads spinning from all the "whipsaw" (including mine).

By the close of the first hour of the trading day, with the help of the Fed Chairman Ben Bernanke's testimony to Congress, SPX reached the high of the day of 1687.18. That intra-day rally reversed quickly after the FOMC minutes were released mid-afternoon, when the market swooned to the lows of the day. There was a slight recovery into the close, but both SPX and RUT had intra-day price moves of over 30 points. I feel this is too large of a swing to risk trade entry, particularly for a weekly position.

Because of the current market conditions over this past week and particularly today's price action, I am not recommending any new trade entry tomorrow. I feel these conditions warrant "sitting on the sidelines" until there is a clearer picture of market direction, and less intra-day movement.

RUT moved 1-1/2 standard deviations, and after the first hour was never within our guidelines to enter the June Iron Butterfly.

Next week I will share another RUT trade with you, an Iron Butterfly for June that is entered approximately 23 - 24 days to expiration. If market conditions are acceptable, I will recommend this trade for entry next week, beginning as a paper trade until you are comfortable with the strategy. Being in between the monthly/30-day, and the weekly/ 8 day cycles, some of you may want to incorporate this strategy into your trade plan.

Cash is a position, and sometimes it's best to sit on the sidelines; "live to trade another day."

Current Position Update:

SPX May 5 Credit Spread:

The current position is pictured in the graph below:

SPX May 5 Put Credit Spread

The current position is -$27.46, or -3% of the maximum margin/risk.

SPX May 5 "Test Kitchen" Iron Condor:

The current position is pictured in the graph below:

SPX May 5 Iron Condor

The current position is -$85.03, or -3.2% of the maximum margin/risk.

Both of these open positions are in no immediate danger, an up-move along with a drop in volatility tomorrow should bring an improvement to them


Trade carefully,

Dot Hazlin