Alternate suggested trade entry for Friday, July 22
Option Code: SPXW160722
Expiration: Friday, July 22
Alternate Trade Entry:
Since posting the recommended trade entry earlier this morning, the mid on the credit (all four legs) for the original strikes recommended has dropped to $1.00, well below the minimum recommended as per the guidelines.
With SPX pulling back ever so slightly since the original trade entry was posted, the 2190 short call strike delta has dropped to .15. While this is on the high end delta-wise for my comfort range, I am suggesting this as an alternate consideration for a trade entry today. The current prices for the revised strikes are:
- SELL SPX July 22 2190 Call, currently $1.95. Delta of short call: .15.
- BUY SPX July 22 2200 Call, currently $1.15.
- SELL SPX July 22 2125 Put, currently $ 1.60. Delta of short put: -.11.
- BUY SPX July 22 2115 Put, currently $1.10.
It is recommended to place the order as a single entry: SELL " Iron Condor".
Current mid price for all four legs: $1.30. We recommend trying to get filled for the current mid or a few cents below. The minimum suggested credit is $1.25. Bid/ask prices can sometimes be wide, so there is no guarantee there will be a fill at the current mid price. Some traders may get filled at a better credit, others may have to cave in a bit to get the order executed.
Please note: Traders should always be aware of any news events that may cause a sudden move in the market. If that occurs, it is recommended to immediately cancel the working order until things settle. Depending on the move that may occur, the above strikes may need to be changed to appropriate strikes within the .10 - .15 range. It is each individual's responsibility to select the strikes they feel most comfortable with, depending on trading style and risk tolerance.
Update will be posted with exact position details when the trade is opened.
For those unfamiliar with the strategy, the trade management guidelines for all Couch Potato Trader strategies were updated on August 20, 2015, and can be found here:
Link to Articles
As always, stay keen on your risk management and trade carefully,