Broader Market Weekly Performance:
Dow +2.42%
S&P +2.44%
Nasdaq +2.22%
Russell +1.57%
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MARKET UPDATE:
Markets moved decisively higher this week after a couple weeks of small gains. >2% gains across the indexes occurred with the exception of the Russell, which "lagged", only posting a 1.5% gain.
The S&P is now perched atop 1400 which sets up things interestingly going forward. A blow-off top is in process, in my opinion, that could take the S&P to 1425-1440 over the next month or so, maybe sooner. The SPX needs to consolidate here as it has accumulated quite a gain for for the year so far +11%. The SPX also traded above its upper Bollinger Band for the last 4 days. That is extreme even for this market.
The 10 & 20 Day MA's lie below in the 1371-1376 area and the 50 Day MA sits at 1340. Both will provide support on any pullback - if pullbacks are still even allowed.
Friday's trading was very tight as it was options expiration. This week's trading will get back to normal as March OpEx is over and April options are now the front month. The almost vertical sloping 5 Day MA sits below 1400 at 1393 and would be a good area provide support on any consolidation or pullback if 1400 is given up by the S&P.
Navigate wisely and stay profitable, my friends. Happy trading!
Autotrade Notice:
TradeKing & TradeMonster Autotrade Discontinued:
Due to continued performance issues and an overall disregard for their account holders well-being, Autotrading is no longer available with TradeKing or TradeMonster
It is unfortunate and the subscribers/clients are the ones who suffer the most. Links are provided below for more information:
BOOKINGALPHA UPDATE:
Monthly Trading Service Commentary:
Monthly Advisory Commentary:
This week's March OpEx brought the successful expiration of two Bull Put Credit Spreads: One on the RUT yielding +4.14% in 11 days and one on QQQ yielding +16.28% in 30 days (the QQQ spreads was part of the Bear Call Credit Spread to Box Spread positions put on previously).
A new SPX Bear Call Spread was released Friday but no fills occurred. I expected this might happen due to Friday's tight OpEx trading range. The order remains open GTC and should fill this coming week. The spread is far OTM, above resistance, and generates a nice credit.
The existing SPX March Quarterly Bear Call Spread remains OTM. As the market exploded higher [again] this week, the spread is getting closer to the money. A nice adjustment to April exists and will most likely be executed this coming week, depending on market action.
The March Quarterly to April adjustment will move the strikes up and out and will generate a net credit. This additional credit while also moving the strikes u[ will improve the risk/reward profile of the position.
Performance of the Monthly Trading Service thus far has been down relative to the S&P. Now that I can look forward, instead of having to manage painful trades, like the the QQQ spread, I feel much better about the portfolio and look forward to getting back in the swing of profitable trading and digging out of the hole.
While losses are unfortunate, they are a part of trading. Looking at past trading years you will see drawdowns like this do occur and ultimately, how I prevailed. This is not a justification, merely a reminder that this situation is still within the realm of normal portfolio gyration. While it may be uncomfortable and is surely no fun, my position sizing allows for these drawdowns providing enough capital to recover. See past year's results and let them speak for themselves. For more information please read: Generating Alpha Comes With Volatility
Monthly Trading Service YTD vs S&P 500:
-10.14% YTD BookingAlpha Monthly Advisory
vs.
+11.65% YTD S&P 500
Weekly Trading Service Commentary:
This week the SPX Bear Call Credit Spread position opened on Monday became threatened when the market exploded higher to new relative highs later in the week.
The spread was closed for a loss as my stop loss threshold was met and exceeded. The loss stung as it erased the gains booked YTD for the Weekly Trading Service.
While losses are unfortunate, they are a part of trading. Looking at past trading years you will see drawdowns like this do occur and ultimately, how I prevailed. This is not a justification, merely a reminder that this situation is still within the realm of normal portfolio gyration. While it may be uncomfortable and is surely no fun, my position sizing allows for these drawdowns providing enough capital to recover. See past year's results and let them speak for themselves. For more information please read: Generating Alpha Comes With Volatility.
You will notice the Weekly Service trades will become more of the scalp variety going forward . This is by design and required to adapt to the current market conditions. Option and overall trading volumes have been very thin YTD sometimes making executions tougher. With the market continuing to float higher, the adaptation to scalping is necessary to dig out of the hole.
As the market floats higher it provides additional opportunities for Bear Call Spreads and Bear Put Spreads to be deployed for nice scalps. I still maintain the continuous search for juicier credits but in their absence, scalp trades will suffice.
Weekly Trading Service YTD vs S&P 500:
-17.47% YTD BookingAlpha Weekly Advisory
vs.
+11.65% YTD S&P 500
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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