Data deluge for the week has investors wondering about market direction, and VIX remains at a cautionary level.
Economic news releases so far this week have been positive, but Wednesday begins the real deluge that will have investors scrutinizing results for a sense of market direction. The news for the rest of the week is below:
- 8:15 am ADP Employment Report
- 8:30 am International Trade
- 8:30 am Productivity and Costs
- 10:00 am ISM Non-Manufacturing Index
- 10:30 am EIA Petroleum Status Report
- 2:00 pm Beige Book
- 8:30 am Weekly Jobless Claims
- 8:30 am ECB President Mario Draghi press conference regarding rate decision
- 8:30 am Monthly Non Farms Payroll
The Nonfarm Payrolls on Friday is the biggest event, and could be a market-mover depending on the results. The VIX remains under 12, at 2 year lows and a level worth being very cautious about.
The SPX Iron Condor test position for the June 1 weekly cycle is currently +$35 as of this writing, or 3.9% of the actual margin. While this is not a live trade, I treat it the same as if it were live capital. With so much news coming out, I am closing this position today. With only 3 days left in this week's cycle, it is not worth the risk to stay overnight and have the potential for a big move against it in the morning.
The current position is shown below:
SPX Iron Condor test position:
My order is currently in to exit the position for a debit of $.70.
It is too early in the week yet to say if I feel comfortable recommending or entering a weekly credit spread for the June 2 cycle. The earliest possible entry date would be on Friday after the Payroll Report is digested. I may elect to sit on the sidelines for one more week, but will post an update later in the week.
As always, trade carefully and stay keen on your risk management,