From the look of futures, today's bullish open may take RUT out of range for a January trade entry.
The FOMC meeting announcement yesterday was just what the bulls were looking for; indices across the board moved up sharply into the close. Overseas markets also reacted positively overnight, and from the looks of futures this morning the bulls appear to be in control once again.
Today is the planned entry day for the January RUT Iron Butterfly, however, as of this writing RUT futures are up over 13 points. This is a one-day standard deviation, and the trade guidelines recommend not entering a new position with this type of move. RUT closed yesterday at 1174.83, +35 points and 3.1% from the previous close.
RUT 6 month chart:
I have added the 14-Day Average True Range to the 6 month chart; which is indicative of the volatility we have seen over the last couple of weeks. This indicator is trending up, increasing the chances that this volatility has not gone away. I see some overhead resistance at 1190, but if that is pierced 1200 could be the next target.
Today is 28 days prior to January expiration, and the last day I would feel comfortable entering the RUT January Iron Butterfly. I will wait and see how the day settles, and consider entry if the market calms down as the day progresses. I will post entry details if an order is submitted.
As always, stay keen on your risk management and trade carefully,