Broader Market Weekly Performance:
Dow +3.58%
S&P +3.70%
Nasdaq +4.03%
Russell +3.99%
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MARKET UPDATE:
After getting creamed last week, markets found their footing jumping higher through the end of the week. All 4 major indexes posted gains Friday to close the week out with +3.70% to +4% gains for the week; basically, recouping last week's losses and then some.
This rally is getting a little overbought short term. That fact, coupled with fast approaching Greek elections and that another test of the 200 Day MA or at least 1300 still needs to occur, provides a great opportunity to scalp some option premium.
Over the weekend a Spanish Bank bailout has been announced and China didn't didn't completely disappoint with it economic releases. Therefore, the week is likely to start off with a pop to the upside. After this bounce a consolidation is likely into mid-week. The healthiest action would be to back and fill some of the recent gains into the end of the week
Navigate wisely and stay profitable, my friends. Happy trading!
BOOKINGALPHA UPDATE:
Monthly Trading Service Commentary:
After previously closing the call side of our original SPY Iron Condor on 6/1 for profit, we used Friday's rally to layer on a new call spread to re-create a new Iron Condor. We also opened a June Quarterly Iron Condor with options expiring 06/30/12.
The existing put spread (IWM) and the Iron Condors (SPY & NDX/MNX) are in very comfortable shape as June OpEx approaches this week. The new Quarterly Iron Condor is positioned well for whatever [additional] volatility may enter the market as a result of the Greek elections....and whatever other Euroland headlines hit the airwaves in the near term!
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 we 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:
-13.83% YTD BookingAlpha Monthly Advisory vs. +5.30% YTD S&P 500
See Trading Record
Weekly Trading Service Commentary:
The Weekly Service trade entry criteria has been adjusted slightly to in response to the rough run lately and the heightened volatility in that markets.
We are using narrower width spreads (meaning they are 1-point wide vs. the typical 2-point wide structure) which allows us to position even further OTM. The skinnier spread widths results in higher commission costs due to more contracts being traded but risk is mitigated by moving further OTM. We would rather pay a little higher commission to provide us more safety with further OTM strikes than save some commission expense with higher risk lower strikes with 2-point wide trade structures.
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 we 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.
Weekly Trading Service YTD vs S&P 500:
-23.77% YTD BookingAlpha Weekly Advisory Portfolio vs. +5.30% YTD S&P 500
Check out the BookingAlpha Trading Record
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