This may be another "sit on the sidelines" period for the weekly credit spread position.
Friday the VIX closed at a one year low, and is hovering at the 2 year low as shown on the chart below:
VIX 2 Year Chart:
SPX is also at record levels; the rally continued yesterday with a new record close at 1911.91. For consistency purposes, the SPX chart below is the same time frame as the VIX (2 year/weekly):
SPX 2 Year Chart:
We have not entered the weekly credit spread strategy for the last few weeks due to all the unrest in the Ukraine and other "news" events. Last weekend the elections took place in the Ukraine, and Putin has agreed to support the winner. However, with SPX and VIX at these record levels, I am not certain yet whether I will be recommending a weekly credit spread for the June 1 cycle. This just may be another week to keep "cash" as the weekly position. At these levels, there is likely to be some consolidation while investors digest the market direction, before a major move. I would rather sit on the sidelines than to be on the wrong side of the move. If I have a clearer sense of direction tomorrow, I will post an update.
This is an excellent opportunity, however, to fine-tune your skills on the weekly trade, and paper trade the weekly credit spread.
At some point in the coming weeks, when (hopefully) the VIX gets back up to a more reasonable level, I do plan to re-introduce the weekly SPX Iron Condor. Right now, however, there just isn't sufficient credit to warrant the risk so I will practice patience before bringing the 10 point wide Iron Condor back into the trading plan.
As always, stay keen on your risk management and trade carefully,