Recommended trade entry for Thursday, March 2
Option Code: SPXW170310
Expiration: Friday, March 10
This is a very cautious trade entry, as the rally continues. Yesterday's runup of over 30 points is being called "parabolic" by some. It is recommended to trade carefully, and consider reducing position size. It is also a trader's choice whether to take the trade or sit on the sidelines for this cycle, depending on your risk tolerance and market opinion. Because I believe in consistency in trading whenever possible, I am entering a small position for this cycle but there is nothing wrong with skipping this week.
Recommended Trade Entry:
- SELL SPX March 10 2425 Call, currently $2.20. Delta of short call: .14.
- BUY SPX March 10 2435 Call, currently $1.25.
- SELL SPX March 10 2340 Put, currently $ 1.65. Delta of short put: -.10.
- BUY SPX March 10 2330 Put, currently $1.35.
It is recommended to place the order as a single entry: SELL " Iron Condor".
Current mid price for all four legs: $1.25, which is the minimum suggested credit for the trade. Bid/ask prices can sometimes be wide, so there is no guarantee there will be a fill at the current mid price. Some traders may get filled at a better credit, others may have to cave in a bit to get the order executed. But it is not recommended to open the position unless you can get $1.25 credit. If the order does not fill today, we will re-evaluate entry tomorrow.
Please note: Traders should always be aware of any news events that may cause a sudden move in the market. If that occurs, it is recommended to immediately cancel the working order until things settle. Depending on the move that may occur, the above strikes may need to be changed to appropriate strikes within the .10 - .15 range. It is each individual's responsibility to select the strikes they feel most comfortable with, depending on trading style and risk tolerance.
Update will be posted with exact position details when the trade is opened.
As always, stay keen on your risk management and trade carefully,