2017 was a stellar year, but it went out with a bit of a slide.

The broad market ended the trading year on a down note as investors became cautious heading into the Holiday weekend. Despite Friday's dip in the afternoon, all the major indices closed within 1% of record high levels.

The benchmark index SPX closed down -13.93 points at 2673.61, ending hear the lows of the day.

SPX 6 month chart

VIX 6 month chart

The VIX closed yesterday at 11.04, up .86 points or 8.45%.

Below is the open position status:

VXX Call Credit Spread for January 5 Weekly Cycle:

This position was opened on Thursday, December 28; details below:

SOLD VXX January 5 29.5 Call, .40 credit.

BOUGHT VXX January 5 34.5 Call, .15 debit.

Order was filled as a "Vertical" for $.25 net credit (all four legs).

Margin/Risk is calculated by the width of the wings ($500), less credit received.

Margin/Risk for this week's trade: $475.

Trade Management:

- Target Gain: 3% of margin

- Max Loss: 6% of margin

Below is the risk graph of this week's position as of the close Friday:

VXX January 5 Call Credit Spread:

Below is the VXX chart showing the short strike:

VXX 6 month chart

Think or Swim is currently showing the position -$6. Our order remains in place to close the position for the target gain (3% of margin) or max loss (6% of margin). I will not be online to monitor the position Tuesday morning, but will post a closing order if either of the orders trigger in the afternoon. It is recommended to check with your broker if you are unfamiliar with conditional orders, as the setup varies slightly between brokers on how to set up conditional orders.

SPY Monthly Iron Condor for January

This position was opened on Monday, December 11; details below:

- SOLD SPY January 271 Call, .52 credit.

- BOUGHT SPY January 276 Call, .10 debit.

- SOLD SPY January 258 Put, 1.03 credit.

- BOUGHT SPY January 253 Put, .64 debit.

Order was filled as an "Iron Condor" for $.81 net credit (all four legs) .

Margin/Risk is calculated by the width of the wings ($500), less credit received.

Margin/Risk for this trade: $419.

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 January Iron Condor:

Think or Swim is currently showing the position +$30, so we will let it continue to work within the trade guidelines.

Below is the SPY chart showing the short strikes:

SPY 6 month chart

Trade Management:

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.

AAPL Iron Condor for February 16

SOLD AAPL February 16 190 Call, 1.53 credit.

BOUGHT AAPL February 16 195 Call, .90 debit.

SOLD AAPL February 16 160 Put, 1.81 credit.

BOUGHT AAPL February 16 155 Put, 1.14 debit.

Order was filled as an "Iron Condor" for $1.30 net credit (all four legs).

Margin/Risk is calculated by the width of the wings ($500), less credit received.

Margin/Risk for this trade: $370.

Target Gain: 10% of margin/risk.

Max loss: 15% of margin/risk.

Please note that AAPL reports earnings on February 1, so we will close the position prior to the release.

Below is the risk graph of the position as of the close Friday:

AAPL February 16 Iron Condor Iron Condor:

Below is the AAPL chart showing the short strikes:

AAPL 6 month chart

AAPL closed Friday at 169.23. The position is currently -$3, and is positive delta so should benefit if AAPL moves up a bit.

Next week's economic news is summarized below:

Monday, January 1

US New Year's Holiday; markets closed

Tuesday

9:45 am PMI Manufacturing Index

10:00 am ISM Manufacturing Index

Wednesday

10:00 am Construction Spending

2:00 pm FOMC Minutes

Thursday

8:15 am ADP Employment Report

8:30 am Jobless Claims

10:00 am ISM Non Manufacturing Index

11:00 am EIA Petroleum Status Report

Friday

8:30 am Monthly Employment Situation Report

8:30 am International Trade

10:00 am Factory Orders

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.

I would like to take this opportunity to thank all of you for your continued support of the Couch Potato Trader and of Option Investor, and wish you all the best in the coming New Year!

As always, stay keen on your risk management and trade carefully,

Dot Hazlin