SPY closed down almost 1% Friday, but our new May Iron Condor trade remained centered and closed slightly positive on day of entry.
At the time this position was opened Friday, I felt it may be time for a calm trading day. Such was not the case; immediately after this position was opened as shown on the 5 minute chart below, the bears took control once again.
SPY Five Minute Chart:
The May Iron Condor position is shown below as of the close Friday:
SPY May Iron Condor
SPY closing at 181.51 put the position well centered between the two short strikes, but it is very early in the trade cycle. As I mentioned on Friday when the position was opened, I entered this non-directional trade very cautiously, given the recent market conditions. This position will be monitored closely, remaining open as set forth in the guidelines.
For those of you that follow or trade the SPX weekly credit spread, I felt it was worth posting the 6 month chart of SPX below.
SPX 6 month chart:
SPX broke through the 1840 support level on Thursday, and Friday's close at 1815.69 brings it dangerously close to the 1800 level. The next level of support that I see is 1775. We could be seeing the tide turning where it is best to sell call credit spreads rather than put spreads. However, I am not ready to put live capital into a short position yet. Whipsaw conditions that have been so common lately make it a very challenging environment for short term traders. The bulls will have to make a hard climb to break through the 1840 level, but anything could happen.
My plan is to see how next week plays out before deciding to enter a new weekly trade. It may be time to re-consider entering the SPX weekly Iron Condor into the trade plan; time will tell.
I will post an update mid-week.
As always, trade carefully and stay keen on your risk management,