Below is a chart of the S&P 500 and the day-to-day sentiment. There can be no arguing with the current bullish trend that is suggesting that prices are headed higher. That does not mean that we do no have our lines in the sand short-term that will suggest otherwise. Those lines are marked for your reference to track, and we suggest setting alerts there.
The sentiment gauge shown is very short-term (since day-to-day) and, because last week was triple witching, it may not be as reliable as a guide. That being said, it’s better being closer to a bullish level with prices looking higher.
Below is a daily chart of Alphabet Inc. (GOOGL).
Trade: Consider selling the following $5.00-wide Iron Condor: sell Sep (9/22) $960/965 bear call spread and sell Sep (9/22) $920/915 bull put spread (5 Days to Expiration (DTE)) for current mid-point of around $1.40/share.
Technical Setup: Range bound daily, time decay strategy.
Option Strategy: Iron Condor (IC).
Max Gain: Credit received, 38.9% ROI ($1.40/3.60) if expires worthless.
Stop Loss: $920 on downside; $960 on upside, close losing position.
Adjustments and Comments on Weekly Option Trades
9/14/17: PXD – Consider shorting Sep (9/15) $134 naked puts (2 DTE) for a limit of $.65/share (closed at $.50 x $.80/share). Note: was a great play, but didn’t get filled at desired credit.
9/12/17: BIDU Shorted Sep (9/15) $227.5 naked puts for $.60/share. Closed at $.10/share for 83% of Max Gain.
9/11/17: KSU – Shorted Sep (9/15) $103/99 bull put spread for $.35/share. Expired worthless for 100% profit.
9/8/17: RE – Shorted Sep (9/15) $160 naked puts for $.45/share. Expired worthless for 100% profit.
Below is a link to individual videos explaining in greater detail the definitions of the main option trading strategies used in the Master Trader Option Strategies Series for Investors and Active Traders to generate wealth and income.
Description of Master Trader Directional and Income Option Trades can be seen HERE
Happy trading! If you have any questions or comments, please e-mail Greg Capra at Greg@mastertrader.com or Dan Gibby at Dan@mastertrader.com
All the best,
Greg Capra
Managing Director of Master Trader
Pristine’s Founder and Creator of the Pristine Method
Dan Gibby
Chief Options Strategist
Follow Greg on Twitter, YouTube, and StockTwits to get real-time updates and education:
Twitter: @GregCapra
Stocktwits: Greg_Capra
youtube.com/c/mastertrader (please subscribe to receive all the timely stock market updates)
NOTE: Master Trader will show opening and closing prices of all stock and options trades. We do not recommend proper share size for your particular trading style, risk tolerance, or account balance. We urge you to calculate your own share size based on your individualized risk parameters, Trading Plan, and familiarity with the proposed trade strategy and risk.
NOTE: Master Trader and its representatives might have existing positions in these and other trade recommendations before or after suggested herein. Additionally, we often manage them differently for internal purposes based on different risk parameters than noted herein.
