Daily Market Newsletter

 

I have no positions in play. At this point I’m expecting movement again because short-term charts are strongly charged, so it makes no sense to pursue an order with this strategy.

I have no current positions; no current setups showing. Too much energy on the short-term charts in the SPY.

The calendar spread tracking sheet is available for your download here. Yes, if you follow the math in the sheet, all of the numbers account for commissions in and out of the trade. Please note: If you trade these positions please keep the size small, to the point where you “do not care” about the success or failure of this position.

I have the following positions in play:

• SDS Stock – I still own 100 shares of this stock from 2011 and will continue to write calls against this position with every correction/pullback.
• VXX Stock – I own 12 shares of this stock and will hold until Armageddon occurs.
• SLV Stock – I have 1000 shares of the SLV that was assigned at the $15 level. I sold the 15SEP $16.5 calls (7/24) for $.17 credit.
• X – I was assigned at the $25 price level. I then rolled the position forward to SEP17 $25 calls for $.68 credit. This continues to lower my cost basis and gives me a little bit more downside protection if the trap door opens.The price has been driving higher lately and there is an improving chance that I can get called out for the SEP cycle. My hope is that I can get called out early prior to any drop in price. I still do not like this pattern, and would like to see as much time value decay out of the call first before the position is closed for a profit.
• AMD – I sold the 15SEP $12 puts (7/31) for $.40 credit. I would sell the position if it closed below $10/share. Looks like we’re seeing a timely bounce that might allow us to avoid assignment.

Not looking to add anything at these levels at this time. I’d like to keep my powder dry and wait on a more severe correction.

 

This is a new section that I’m starting in the summer of 2017; all Cryptocurrency trades are by definition going to be “directional” trades due to the fact that there are no premium-selling strategies available.

 

Please refer to the left sidebar section if you’d like to get caught up on “FAQ” -style intro videos.

Investors should currently be looking to find technical entries to warehouse BTC/ETH/LTC assets for eventual trades on Alt-coins. You should also be looking to devices like “trezor” or other cold-storage devices to keep your assets off of the network. Relying on the security of your broker is no longer good enough; no one can log into your ETrade account and “steal” your stock assets, but the whole nature of Cryptocurrencies and their portability means that someone can grab your assets and transfer them elsewhere.

In the main video in today’s newsletter I talked about the “big three” currencies and how they are quickly going parabolic; price action will be more “natural” in these assets so expect to see much larger corrective patterns than you have seen recently with equities. We are near an exhaustion point in these assets so this is probably not a good time to chase after them; wait on your entry.

I will also talk about the tradingview platform in today’s video.

Here is today’s video which is about a new feature in Coinbase that allows you to transfer coins.

 

This is a new section that I’m going to start laying out trades for weekly “expected moves.” The S&P500 has done a nice job of moving pretty much to one end of the overall expected move every week. We can either speculate on that direction ahead of time using OTM spreads, or we can “fade” the price when it hits one of the EM levels.

Viewing the SPY from the current Friday closing price at 244.56, there is a +/- 2.34 EM into this Friday. This is smaller than last week’s EM, and back down to previous week’s EM values of about 2 points during most of the summer.

The EM targets for this Friday’s close is 246.9 to the upside, and 242.22 to the downside.

Now you see why I said on Saturday that if the price hit the upper marker, “it might make a bad fade setup for the reasons that I discussed in Saturday’s video.” A breakout is a violent swing and an expected move marker will not offer enough resistance to keep it in. I will not fade this level tomorrow.

I have no positions at this time. Nothing else to enter at this time.

I have the following positions:

 

• SPY 15SEP 249/250 Call Spread (8/28) was entered for an $.11 debit, and looking for the price to re-test recent highs.

 

I do not have any setups that look really great at this time, and markets likely to consolidate or pull back in the short run. Have a look at BIDU; we might look to re-enter this position should the weekly chart recharge again.

I entered the SPY “flier” which was detailed in Saturday’s newsletter. So far it’s doing exactly what we entered it for and is up over 100% in value. I want to see if the price can rise over the current “lower high” pivot first before I remove it.

The “Hindenburg Strategy” is meant to capture “value” from successive corrections that lead up to the final “death spiral” with a Bear Market. The basic principle is to buy 3-month out long puts on the SPY, and to finance those puts by the sale of credit spreads.

Quite honestly, selling the “financing” trades has been a huge challenge in this low-vol environment. I will only sell put spreads on decent pullbacks that allow me to secure put spreads 10% OTM

With a new all-time low VIX, the opportunity to buy inexpensive short deltas was too great, so I added some OCT puts recently.

We currently have the following positions in play with this strategy:

• SPY OCT17 222 long puts (7/24) – I entered this position for an $.85 debit. This position was up 50% and the temptation to remove it for a profit is strong, however the point of these trades is to hedge the downside for existing longs, AND try for those home runs on corrections that come out of nowhere.