The market closed higher Friday; but snapped its multi-week winning streak.
The broad market closed higher Friday after a better-than-expected jobs report for February was released. The U.S. added 235,000 new jobs in February, and the January number was revised upward to show payrolls rose 238,000. The current unemployment rate is 4.7%.
The benchmark index SPX closed up 7.73 points, +.33% at 2372.60. SPX was not able to continue its weekly gains, the close Friday represented a loss for the week of -.4%.
Below is the open position status:
SPX Weekly Iron Condor for March 17 cycle.
This position was opened Friday, March 10; details below:
SOLD SPX March 17 2410 Call, 1.75 credit.
BOUGHT SPX March 17 2420 Call, .75 debit.
SOLD SPX March 17 2325 Put, 2.10 credit.
BOUGHT SPX March 17 2315 Put, 1.85 debit.
Order was filled as an "Iron Condor" for $1.25 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: $875.
Target Gain: 7% of margin/risk or $60.
Max loss: 10% of margin/risk or $85.
Below is the risk graph as of the close Friday:
SPX March 17 Weekly Iron Condor:
Below is the SPX chart showing the short strikes:
SPX 6 month chart
As of the close Friday, the position is currently +$20. My order remains in place to exit the position when the target gain of $60 is reached, which would be a debit of $.65. The position will also be closed at the max loss of $(85) if the debit reaches $2.10. It is, however, recommended to close the position regardless before the release of the FOMC meeting on Wednesday afternoon. There is quite often some volatility around this news which could put our position in jeopardy with little time to recover.
As I expected, it was difficult to get a fill this week; the credit dropped as soon as our order was executed. The bid/ask prices are wider than usual on the monthly cycle, but there was too much risk to consider an early entry with the jobs report coming out yesterday morning. Next week we will look at entering the weekly Iron Condor on Thursday, depending on market conditions and available credit.
Next week's economic news is highlighted below:
9:00 pm China Industrial Production Report
FOMC Meeting Begins
8:30 am Producer Price Index
8:30 am Consumer Price Index
8:30 am Retail Sales
8:30 am Empire State Manufacturing Index
10:30 am EIA Petroleum Status Report
2:00 pm FOMC Meeting Announcement
2:30 pm Fed Chair Yellen Press Conference
8:30 am Jobless Claims
8:30 am Philadelphia Fed Business Outlook Survey
9:15 am Industrial Production
10:00 am Consumer Sentiment
Next week is the planned entry for the April SPY Iron Condor. Monday will be 39 days to expiration. Depending on market conditions and available credit, we will look to open this position sometime next week.
Trade updates will be posted as appropriate.
As always, stay keen on your risk management and trade carefully,