SPX Weekly Credit Spread for May weekly cycle; waiting until after Yellen's testimony before entering this new position.
Janet Yellen's testimony on Capitol Hill yesterday and subsequent Q & A session brought some volatility to the market. Once investors digested her report, SPX rallied to close +10 points, at 1878.21.
As of this writing, futures are flat in advance of the open; Janet returns for additional testimony this morning. As long as SPX remains within the guidelines, a new weekly trade will be entered for the May cycle. The option code is 140517; this is the regular monthly cycle expiring May 17. The 20Day EMA is at 1871.08. So unless there is a serious negative reaction to this morning's speech taking SPX outside the entry guidelines, a Put Credit Spread will be opened.
I will wait until the afternoon before entering to avoid the potential late-day volatility we have seen so frequently. I will look to sell a put spread with a short put delta of -.15 or less, for .75 minimum credit.
It is a trader's choice as to exact entry time depending on your market view and trading schedule.
Trade entry details will be posted after entry.
As always, stay keen on your risk management and trade carefully,