The market is really struggling to maintain forward momentum. The European debt crisis and the light holiday volume are both a challenge for the bulls.
Volume barely broke six billion shares on Monday and the S&P barely edged over 1250 before pulling back. It was a day of false starts and direction changes. Many stocks that opened higher finished lower and quite a few that opened lower went on to finish higher. It was really hard to really determine market sentiment and direction.
Of course trying to read the market in a holiday week is a task best left to fools and idiots because anyone trying to predict it accurately will end up looking like a fool or an idiot.
We know there is a long term bullish bias but after a +19% gain over the last three months anything is possible as we approach year end.
I raised the stops on a couple of plays to take us out of trouble if this fragile market takes a sudden dip.
Current Position Changes
New Long Term Recommendations
None - Waiting for a "real" market dip
New Aggressive Recommendations
There are several different formulas for determining margin requirements for naked put writing. These are normally broker specific and some can require larger margin requirements than others.
Here is the most common margin calculation for naked puts.
100% of the option premium + ((20% of the Underlying Market Value) - (OTM Value))
For simplicity of calculation simply use 20% of the underlying stock price and you will always be safe. ($25 stock * 20% = $5 margin)