My plan:
Indices futures moved up somewhat overnight. ES is pushing into yesterday's thin area. The current LVA is 2020 to 2060. On the up movement I will try to sell bear calls in SPY, SPX & RUT to make my positions in strangles. On the push down I will try to sell credit spreads. Watch out for the risk of another leg down to 2009 and 1999 levels.
Grains moved higher. Corn and wheat took out yesterday's highs. Did they form another bottom? It's possible they are building it. Soybean is still weak and may explore below. My plan is to lock in profit in wheat and reduce my holdings when I can. I will continue to manage risk in corn and let soybean decay.
My execution:
Indices shoot up right off the gate open. It was an open drive and broke yesterday's high in the first hour. Then the bears came in by noon. It ended giving up over 20 point gains and closed below yesterday's low. Clearly it's a bearish engulfing day. However in the bigger picture and context of volume profile ES/SPX are still filling in this low volume area unless 1990 and 1970 give in which would be a repeat the pattern of last Oct. I followed my plan but didn't accomplish much. All of my bear calls didn't get filled since I wanted to see where it close today. By noon I lowered my entry prices in SPX and RUT but never got a pop strong enough to fill me in. I had one set of SPY Feb 175 naked bull put filled in Etrade when the price was near low of yesterday. Now it appeared too early. Let's see if the sell off continues tomorrow I will have chance to sell again or wait for more down side.
Grains moved down further with corn reversed from yesterday's pop and closed out of its balance area. My corn bear calls got a big relief and wheat bull puts are under pressure now. I will start risk reversal in wheat when and if we get a pop. It's also time to lock in some profit in corn and wheat bear calls.
I was fairly calm. I started to post my trades with KST group in Skype. It help me to think clear my reasons to put on a trade.
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