It was all about the jobs report yesterday.
The broad market did close higher Friday, rallying in the afternoon after being in the red most of the day. Investors struggled with the jobs report released before the open, and what it may mean to the Fed's monetary policy. Friday's monthly non farms payroll report missed expectations, indicating that companies added 160,000 new jobs in April, quite a miss from the 203,000 gain forecast.
Despite the late-day rebound, the main indexes booked their second consecutive weekly loss. SPX closed up 6.51 points at 2057.14, up .32% for the day but -.4% for the week.
Below is the open position status:
SPX Weekly Iron Condor
This May 13 weekly position was opened Friday; trade details are:
SOLD SPX May 13 2100 Call, .75 credit.
BOUGHT SPX May 13 2110 Call, .35 debit.
SOLD SPX May 13 1995 Put, 3.40 credit.
BOUGHT SPX May 13 1985 Put, 2.40 debit.
Order was filled as an "Iron Condor" for $1.40 net credit (all four legs).
Margin/Risk is calculated by the width of the wings ($1,000), less credit received.
Margin/Risk for this week's trade: $860.
Target Gain: 7% of margin/risk or $60.
Max loss: 10% of margin/risk or $85.
The risk graph showing the position as of the close is below:
SPX May 13 Weekly Iron Condor
The position is currently showing a gain of $.45, the debit to exit is $.95 as of the close yesterday, although sometimes after-hours prices are not accurate. Our good-to-cancel order remains in place to exit for target gain, so we will see what Monday brings. As outlined in the guidelines, the position will also be exited at the pre-set max loss of 10%. The position is well centered going into next week.
Below is the 6 month chart showing the short strikes:
SPX 6 month chart
Next week's economic news is summarized below:
10:30 am EIA Petroleum Status Report
8:30 am Jobless Claims
8:30 am Import & Export Prices
8:30 am Retail Sales
8:30 am Producer Price Index
10:00 am Business Inventories
10:00 am Consumer Sentiment
Next week is the planned entry for the SPY June monthly Iron Condor. Monday will be 39 days to expiration, so we will look to enter the position sometime next week depending on overall market conditions and available credit.
For those unfamiliar with the strategies we trade, the trade management guidelines for all the Couch Potato Trader plays were most recently published on August 20, 2015, and can be found here:
Link to Articles
Trade updates will be posted as appropriate.
As always, stay keen on your risk management and trade carefully,