Despite the historical trend, the first week of August closed on a bullish note.
Despite the historical trend that August and September are two of the weakest months of the year, the overall market closed up Friday after a positive jobs report. Yesterday's employment report released before the open indicated that the US added 209,000 new jobs in July, beating estimates of 175,000. The unemployment rate went from 4.3% to 4.4%, a 16-year low.
The benchmark index SPX closed at 2476.83, up 4.67 points or 1.9%.
We do not have any open positions this weekend. The pathetic premiums on the weekly Iron Condor cycle for August 11 were not worth risking capital to enter a new short term weekly trade. We will enjoy cash as our position this weekend and hope for a better entry next week.
SPX 6 month chart
The "fear" index, VIX, remains at historically low levels. It could rear its ugly head at any time, and it has been coiled up at this level for so long, when volatility returns it could be ugly. We will continue to be vigilant on all positions we enter, keeping risk management at the forefront at all times.
Yesterday the VIX closed at 10.03, down .41 points, or 3.93%. The 52 week range on the VIX is 8.84 - 23.01.
VIX 6 month chart
Next week's economic news, is summarized below:
Monday, August 7
11:45 am Fed's James Bullard speaks
1:25 pm Fed's Neel Kashkari speaks
8:30 am Productivity & Costs
10:30 am EIA Petroleum Status Report
8:30 am Jobless Claims
8:30 am Producer Price Index
10:00 am Fed's William Dudley speaks
8:30 am Consumer Price Index
11:30 am Fed's Neel Kashkari speaks
Next week is the planned entry for the September SPY Iron Condor. Monday will be 39 days to expiration, so we will look to open the position next week 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 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,