The Small Cap Divergence Continues 7-19-18

The futures were down overnight. The majors were under pressure throughout the day except for RUT which closed up 0.5% while the others in red. RUT is likely to challenge new high again on a triple top formation. 

Made 3 trades today. Moved out my August 3rd ITM SPX bear call with another ITM bull put. Sold some late August QQQ bull puts for clients. I just need to add hedges on both sides tomorrow so I will feel better on the trip.

Net liq slipped about 1K on the RUT surge. The margin ratio is above 50% and the weekend looks OK.

Grinding Up 7-18-18

The pattern of buy on any dip is in play again. Today's morning weakness was met with buyers. The majors were grinding up. SPY is getting into the gap zone of the selloff in February. There may be attempts of selling in this area on a technical base. I want to use the opportunity to add bull put and bring up my bear call. Got to think what if the majors go up 5, 8, or 10% from here.

Made 8 trades today. I finally exited the SPX 2800 bull put entered in March. It freed some margin for me to add another ITM bull put and moved up 60 points of my RUT 1240. I have only one deep ITM SPX bear call before August monthly. I have 2 days to roll it out before the China trip. No premiums collected for clients.

Net liq is still in the range of 118K. The margin ratio is above 60%. This weekend expiration looks OK so far.

Can't Hold The Market Down 7-17-18

When NFLX dropped 15% after earnings report people thought it would be a bad day today. It turned out that the bulls didn't care of any bad news. They pushed the majors up. QQQ even made another ATH. I guess the Fed Chair's testimony in Congress gave a positive tone to the market. The earnings session keeps bulls strong and fearless.

Made 8 trades. Sold a couple SPX naked bear calls of August 3 for clients. I am very cautious about selling bear calls. That is the place I often get into trouble with. I didn't collect any premiums for the 2nd day. I only closed positions and added hedges. I am waiting for the SPX 2800 to close tomorrow and the RUT 1700 expiring on this Friday. I can roll additional bear calls to bull puts if this two are out.

Net liq held well on today's pop. The margin ratio is above 50%. I continue to prepare for the China trip.

Waiting For Something?

I was expecting a small breakout at least following the HOD closing last Friday. The majors opened flat and traded in a small range without breaking either side. They closed slightly down. NFLX disappointed the market in their earnings report. It dropped 14% in after hour session. Not sure how it will affect the market tomorrow. The breakout is still likely with more positive earnings reports.

Made 15 trades today. Added a set of the end of August RUT bull puts for clients. I rolled up my RUT 1235 to 1240 during the RUT weakness. I am waiting for one of my ITM bull put to expire before adding another one to it. I had to roll the SPX 2805 to this Wednesday as it won't get off today.

Net liq upped to 117K. The margin ratio is above 50% for now. I may borrow a little more cash from ET if I want to go on the China trip.

Market Pause 7-13-18

Bulls and bears took a day off today. The big banks' earnings reports were mixed. The majors booked 0.2% gains and losses. It was a flat day. SPX almost erased the losses from Feb- March period. It may start to move higher with this earning session.

Made 13 trades today. None of the ATM and ITM positions expired worthless. I had to roll them into different expirations. Luckily I collected some premiums from these rollovers. I used the premiums to reverse my SPY and IWM from next week's puts to long calls of August. Hopefully, it will recover some of my losses from the puts.

Net liq closed up nearing 115K. The margin ratio is predicted fine for the weekend expiries. I plan to buy more hedges early next week in preparation for the possible China trip. 

Earnings Taking Place 7-12-18

The majors bounced back from yesterday. There is not much fear of anything. The saying is that sentiment over fundamentals. QQQ broke out and made another all-time high again. SPX closed only 2 points short of 2800. The momentum is back.

Made 10 trades today. I am still trying to roll my positions to mid-August for the possible China trip. Moved my July 20 SPX 2905 to July 16, 2805, in hope of an early expiration.  I will roll it out to August if it doesn't work. Rolled a couple of ETFs for clients. The rest of the trades were hedgings.
I have two RUT ATM bull puts needs close attention. Then comes Monday's SPX 2805.

Net liq improved a bit to 113K. The margin ratio looks OK for this week's expirations. I need to see the effect of margin impact once the rollovers are in place. I may have to spend more money to buy hedges if I am going on the trip.
 

A Pullback On The Trade War Phase II 7-11-18

The overnight selloff on the 2nd phase of the trade war didn't go too far. Nobody knows what would be the economic impacts of the newly proposed $200 billion tariffs would have on the US, China, and global economy. The market appears paying more attention to the current earning session. The majors closed down less than 1%. It couldn't even count as a selloff at the end.

Made 14 trades. Sold some late August bull put spreads in the indexes for my clients. I couldn't get too far on the strikes since the VIX is not high. I rolled out two more of my ITM bear calls. The margin is getting heavier on the put side.

Net liq is still in the 111K range. The margin ratio is down to 35% but expected to rise over the weekend. I have two more days to work on the trip preparation.

A Sign Of Divergence 7-10-18

The majors continued pushing higher overnight. The sentiment is pretty strong. During the RTHs the small-cap started weakening. After ticks of a new high, it went into negative territory and shred off 0.8% before buyers stepped in. After the hour the administration announced a list of $200 billion new tariffs for Chinese products. The futures dropped more than a half of percent.

Made 15 trades today. I rolled 3 of my ITM RUT in both puts and calls when I saw the weakness in RUT. My plan was to move all of the ITM positions to mid of August so I can make the trip to China. I may not be able to make it since my net liq is very thin. I may be on margin call if a major move happens during my absence. I sold a couple of RUT mid-August bull puts for clients. I may sell more if the market continues to slide tomorrow. I will try to roll my SPX ITM bear calls. I may face some difficulty on the put side margin requirement.

Net liq is back at 112K. The margin ratio is at 44%. The margin is on the put side now.

The Rally Continues 7-9-18

The bulls carried last Friday's rally into today with gap up on the open. Dow was taking the lead gaining 1.3%. The trade war seems no effect on the market sentiment. Shanghai index popped more than 2%. The MACDs on daily indicate more upside potentials. The starting of earning session held the majors well.

Made 6 trades today. I tried to roll down my near-term ITM bull put to expire sooner in the majors. I was only able to split my RUT 1715 into this Friday's expiration. I will roll it out to August monthly if it won't exit out. I want to accompany my daughters to China next week. I must roll all of my ITM positions to August monthly at least. The market hasn't given me much of the opportunities so far. I may not be able to go if the margin pressure is too strong.

Net liq went below 110K when everything is up. The margin ratio is at 43%. Now it's the expiry weekend worries me. I will try to add some ETF hedges on tomorrow.

Better NFP Report 7-6-18

The June NFP added 213K new hires v.s. 195K expected. The initial reaction from the market was muted. After no selling pressure from the trade war, the majors started pushing up. They broke out from their current balance areas pointing to more upside potentials.

Made 13 trades. Covered the cost of QQQ call spreads for clients. I made a mistake with a QQQ short call of this week. I forgot to deactivate the order after I rolled the long call for a client's acct. It got filled on today's 1.5% surge. I had to close it out in the last hour with a $35 loss. All of the trades in my account were hedges of about $130. 

Net liq lost another 1.6K. The margin ratio is up for this weekend expiration. But the available funds will be below 30K. I will aggressively roll my calls and puts to prepare for this possible new high breakout.

Up For The Job Report 7-5-18

The majors pushed up across the board in 1% range getting ready for the NFP report tomorrow. So far SPY and QQQ are closed at the top of their balance areas ready for break out or drop down. RUT has breached its top of the balance area. Its MACD is crossed up on the daily chart. The job report and the starting of earning session are positive factors while the trade war is negative on the market. The effective tariffs on the economy may not be seen for months at least.

Made 5 trades. I tried to get some long call spreads in ETFs but only got a couple of them. My directional positions are very lite. Also, bought two hedges in the big cars. Need to add more hedges tomorrow as usual.

Net liq is at 112K. The margin ratio is OK for tomorrow.

Choppy Before The Major Events 7-3-18

It was a half of trading day before the July 4th holiday. The majors opened in positive territory. The small-cap led the push-up. It looked like the retest of the breakdown point of last week. QQQ started selling off before lunch. It dragged SPY down and made IWM gave back more than a half of its gains by closing. This Friday has two conflicting events: The NFP of June and starting date for tariffs to Chinese products. Don't know which event will gain an upper hand. But the earnings session is right around the corner.

Made 21 trades today. Most of them were for the clients. I closed some ETF put spreads to cover part of their cost. Rolled some weekly ETFs to extend their positions. Most of the ETF calls lost their value. I have collected some profits before this downturn.

Net liq is down 1.6k with RUT up. The margin ratio is fine until the end of this week. I get a day off tomorrow.

A Reversal Up?

The US market opened lower this morning following the Europen and Asian markets. The majors reversed up when sellers couldn't couldn't break last week's lows. They closed into positive territories, as QQQ and IWM gained more than 0.6%. It looks like a reversal day to the upside or at least the selling is halted with the July 4th holiday on Wednesday and NFP report on Friday. The market may also accept that the trade war will be a reality soon.

Made 18 trades today. I tried to close some of my ETF puts to recover part of the cost with a little luck. Also, added ETF calls when I realized the reversal may be underway. Some exit orders were filled. I added hedges in both SPX and RUT.

Net liq stayed at 114K. The margin ratio is above 50%. I expected it will be a slow afternoon tomorrow as people are getting ready for the holiday.