FOMC did not produce the vol pop we were looking for; conditions are too dangerous for a weekly Iron Condor.
Everyone was waiting, and watching, to see if the FOMC meeting announcement yesterday would produce some volatility in the market. There was some post-announcement selling, but as usual the buy-the-dippers came in towards the close.
This morning the VIX is below 10, and there are no premiums available for an SPX Weekly Iron Condor for the September 29 cycle.
This weekend we also have the added market risk with the German Parliamentary elections, which had slipped off my radar when I posted the upcoming economic news yesterday. Thanks to our subscriber Jean-Charles for reminding me of this event taking place on Sunday. Chancellor Andrea Merkel has led the country for 12 years and is expected to win again. However, a surprise win by her main opponent Martin Schulz could rock the market, even if it is short-term. We all remember the surprise in the USA elections last November, and how the market reacted.
We are not recommending a trade entry this week for the SPX weekly Iron Condor for the September 29 cycle. We have both RUT and SPY monthly positions on, and will manage those accordingly and hope for a better entry environment for the weekly Iron Condor next week.
For those who may be disappointed, my apologies and of course traders may venture into their own trade if they choose to do so. In my opinion, it is not risking hard-earned capital for a less than desirable trade.
As always, stay keen on your risk management and trade carefully.