Consolidation continues as traders enter the summer doldrums season.
The broad market finished flat for the week as the market continues to drift higher. The benchmark index SPX closed up just .69 points Friday at 2433.15, which represented a gain for the week of just 0.1%. The volatility index VIX continues to remain at record low levels, the close yesterday at 10.38 represented a drop of -.52 points or 4.77%.
Below is the open position status:
SPY Monthly Iron Condor for July
This position was opened on Monday, June 12; details below:
- SOLD SPY July 248 Call, .46 credit.
- BOUGHT SPY July 253 Call, .08 debit.
- SOLD SPY July 234 Put, 1.23 credit.
- BOUGHT SPY July 229 Put, .79 debit.
Order was filled as an "Iron Condor" for $.82 net credit (all four legs) .
Margin/Risk is calculated by the width of the wings ($500), less credit received.
Margin/Risk for this trade: $418.
Target Gain: 10% of margin/risk.
Max loss: 15% of margin/risk.
Below is the risk graph of the position as of the close Friday:
SPY July Iron Condor:
Below is the SPY chart showing the short strikes:
SPY 6 month chart
As of the close, Think or Swim is showing the position +$22, so it is off to a decent start.
The guidelines call for the position to remain open until target gain is reached, as long as SPY stays between the short strikes. They also call for exiting at the pre-set max loss, or if SPY reaches either short strike. It is recommended to have a "good to cancel" conditional order in to exit the position for target gain or max loss. Please follow your broker's specific guidelines on the setup of conditional orders as they can vary by broker.
Next week's economic news, is summarized below:
Monday, June 19 and Tuesday, June 20
No economic news
10:00 am Existing Home Sales
10:30 am EIA Petroleum Status Report
8:30 am Jobless Claims
10:00 am New Home Sales
Next week is the planned entry window for the RUT Iron Butterfly for July. Monday will be 32 days prior to expiration, so we will look to enter sometime in the coming week depending on market conditions and available credit.
For those unfamiliar with the strategies we trade, the trade management guidelines for all the Couch Potato Trader plays 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,