SPX Weekly Iron Condor for January 5 Cycle; may be out of entry range today.
We have not been trading the SPX weekly Iron Condor yet this year because of all the market volatility which can be deadly for short term trades such as the weekly. I had planned to suggest a trade entry today for trading with Paper Money, NOT live capital. I feel the market is still way too dangerous to risk hard-earned capital into a short term trade.
However, futures as of this morning are up 26 points, which is more than a one-day standard deviation. The trade guidelines call for a "NO ENTRY" if SPX has moved up or down more than a one-day standard deviation which according to my broker's calculation is 23 points.
SPX 6 month chart
It appears that the bottom has been reached and SPX is headed for a rebound, but we'll see if the bulls can keep things rolling. If you note on the chart above where I have added the Average True Range indicator, the 7-day ATR as of the close yesterday is 51 points. We may not be out of the woods yet.
Jim Brown made a great statement in his Market Wrap the other day; "Be patient. It is better to be bored than broke".
If the situation changes later in the day today, I "may" suggest entering a paper trade to test the weekly position to see how it behaves. As stated above, however, I am not recommending this to be traded with live capital this week. There is always the possibility of an entry on Monday, which I look at if I don't feel even a paper trade is worth entering today.
For those unfamiliar with the strategy, the trade management guidelines for all Couch Potato Trader strategies were updated on August 20, 2015,and can be found here:
Link to Articles
In the meantime, stay keen on your risk management and trade carefully,