Rate hike fears overcome Wall Street; we saw the worst slide since post-Brexit Friday.
Fed speakers sent the bulls into hibernation Friday as the reality of a September rate-hike spooked investors.
Comments from Eric Rosengren, Boston's Fed President and a voting member on this year's board, helped to contribute to the selloff. He said on Friday that the U.S. central bank could resume gradual rate increases as the risks facing the economy are more in balance, reigniting investors' anxiety about the end of easy-money policies.
The benchmark index SPX dropped 53.49 points, a 2.45% drop, closing at the intra-day low of 2127.81. This represented a weekly loss of 2.4%.
We do not have any open positions on this weekend; obviously Friday's selloff took SPX out of entry range for the weekly Iron Condor.
Below is the 6 month chart which is not a pretty picture:
SPX 6 month chart
CBOE's "fear index" VIX spiked up 39.89% to close at 17.50, which is the largest one-day jump since June 24. Below is the 6 month chart of the VIX which illustrates the fear that has taken over Wall Street:
SPX 6 month chart
Next week's economic news is summarized below:
10:00 pm Industrial Production - China reports
8:30 am Import/Export Prices
10:30 am EIA Petroleum Status Report
8:30 am Jobless Claims
8:30 am Producer Price Index
8:30 am Retail Sales
8:30 am Philadelphia Fed Business Outlook Survey
8:30 am Empire State Manufacturing Survey
9:15 am Industrial Production
8:30 am Consumer Price Index
10:00 am Consumer Sentiment
Next week is the planned entry window for the monthly SPY October Iron Condor. Monday will be 39 days until expiration; so we will look to enter depending on overall market 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,