Another record-high closing; will anything stop the bullish run?
Below is the open position status:
The broad market ended at record-highs once again, ending the week, month, and the quarter on a high note. The benchmark index SPX closed up +9.30 points, .4% at 2519.36. The close Friday represented a milestone for the 39th time this year. SPX's gains are impressive: .7% for the week, +1.4% for the month, and 3.9% since July.
SPX Weekly Iron Condor
This position was opened on Thursday, September 28; details below:
SOLD SPX October 6 2530 Call, 1.45 credit.
BOUGHT SPX October 6 2540 Call, .70 debit.
SOLD SPX October 6 2460 Put, 2.50 credit.
BOUGHT SPX October 6 2450 Put, 1.95 debit.
Order was filled as an "Iron Condor" for $1.30 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: $870.
Target Gain: 7% of margin/risk or $60.
Max loss: 10% of margin/risk or $85.
Below is the risk graph of this week's position as of the close Friday:
SPX October 6 Weekly Iron Condor:
Yesterday's bullish run was not kind to our position; Think or Swim is showing the position -($60) as of the close. If the rally continues on Monday, we may be forced to exit the position if our stop loss debit of $2.15 is reached.
Below is the SPX chart showing the short strikes:
SPX 6 month chart
The guidelines call for the position to remain open until target gain is reached, as long as SPX stays between the short strikes. They also call for exiting at the pre-set max loss, or if SPX reaches either short strike. It is recommended to have "good to cancel" order in for both target gain and max loss. The setup of conditional orders can vary by broker, so please check with your broker if you are unfamiliar with conditional orders on your trading platform.
SPY Monthly Iron Condor for October
This position was opened on Monday, September 11; details below:
- SOLD SPY October 253 Call, .47 credit.
- BOUGHT SPY October 258 Call, .08 debit.
- SOLD SPY October 239 Put, 1.10 credit.
- BOUGHT SPY October 234 Put, .69 debit.
Order was filled as an "Iron Condor" for $.80 net credit (all four legs) .
Margin/Risk is calculated by the width of the wings ($500), less credit received.
Margin/Risk for this trade: $420.
Target Gain: 10% of margin/risk.
Max loss: 15% of margin/risk.
Below is the risk graph of the position as of the close Friday:
SPY October Iron Condor:
Think or Swim is showing the position is at breakeven, still very short delta so would benefit from a pullback. SPY closed Friday at 251.44, +.21 or .08%.
Below is the SPY chart showing the short strikes:
SPY 6 month chart
Next week's economic news, is summarized below:
9:45 am PMI Manufacturing Index
10:00 am ISM Manufacturing Index
10:00 am Construction Spending
8:15 am ADP Employment Repoert
10:00 am ISM Non Manufacturing Index
10:30 am EIA Petroleum Status Report
2:15 pm Fed Chair Janet Yellen speaks
8:30 am International Trade
8:30 am Jobless Claims
9:30 am Fed's John Williams speaks
10:00 am Fed's Patrick Harper speaks
10:00 am Factory Orders
8:30 am Employment Situation Report
12:15 pm Fed's William Dudley speaks
12:45 pm Fed's Robert Kaplan speaks
For those unfamiliar with the strategies we trade, the trade management guidelines for all the Couch Potato Trader plays 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,