This market is going to the moon!
The broad market ended the week at historic highs; the benchmark index SPX closed up 13.34 points at 2259.53. This gain logs the longest winning streak for SPX since June 2014. The index is up more than 5% since election day; and yesterday's gain represented a gain of 3.1% for the week.
Below is the open position status:
SPX Weekly Iron Condor for December 16 cycle
This position was opened Friday, December 9; details below:
SOLD SPX December 16 2290 Call, 2.17 credit.
BOUGHT SPX December 15 2300 Call, 1.30 debit.
SOLD SPX December 16 2195 Put, 1.86 credit.
BOUGHT SPX December 16 2185 Put, 1.43 debit.
Order was filled as an "Iron Condor" for $1.30 net credit (all four legs).
Margin/Risk is calculated by the width of the wings ($1,000), less credit received.
Margin/Risk for this week's trade: $870.
Target Gain: 7% of margin/risk or $60.
Max loss: 10% of margin/risk or $85.
Below is the risk graph of this week's position as of the close Friday:
SPX December 16 Weekly Iron Condor:
The position is currently showing the position is +$10; the debit to exit as of the close yesterday is $1.20. Our order remains in place to exit the position when the debit is $.70 which would be target gain, or the max loss which is 10% of the margin. It is, however, recommended to exit the position regardless before the FOMC meeting announcement Wednesday afternoon. This news usually brings some volatility to the market which could be detrimental to our position with little time to recover. The position is quite negative delta so should benefit in the event of a pullback Monday.
Below is the SPX chart showing the short strikes:
SPX 6 month chart
Next week's economic news is highlighted below:
9:00 pm China Industrial Production Report
FOMC Meeting Begins
8:30 am Import/Export Prices
8:30 am Producer Price Index
8:30 am Retail Sales
9:15 am Industrial Production
10:30 am EIA Petroleum Status Report
2:00 pm FOMC Meeting Announcement
2:30 pm Fed Chair Janet Yellen Press Conference
8:30 am Jobless Claims
8:30 am Consumer Price Index
8:30 am Philadelphia Fed Business Outlook Survey
8:30 am Housing Starts
Next week is the planned entry window for the January SPY Iron Condor. We will plan to enter sometime next depending on overall market conditions and available credit.
For those unfamiliar with the strategies we trade, the trade management guidelines for all the Couch Potato Trader plays were most recently published on August 20, 2015, and can be found here:
Link to Articles
Trade updates will be posted as appropriate.
As always, stay keen on your risk management and trade carefully,