Market Overview

Weekly Iron Condors Approaching Expiration


BookingAlpha subscribers have 2 weekly Iron Condors approaching expiration this Friday. The trades are on the SPY and IWM index tracking stocks which have enjoyed quite a run last week and this week already.

Earnings continue to be strong and economic data is relatively light this week. This may allow the markets to continue to drift higher. However, with new highs being made each day, I don't expect any power moves at this point to catapult the market higher as a result.

At the same time, any decline will be bought swiftly as while Managers do not want to chase stocks at these levels, they have made it clear they are ready to shovel more money into the market on dips.

Getting back to our Iron Condors, both indexes/ETF's are getting pretty overbought at these levels. Both stocks are walking along their upper Bollinger Bands. Both ETF's RSI's have breached the 70 mark which is an overbought reading. The Williams %R for both are pegged at extreme highs signaling overbought. MACD for both is reaching previous resistance levels.

In summary, as illustrated above with technical readings and market behavior, I only expect a continued grind higher if we do indeed continue higher this week. In the event of a continued melt-up this week, both Iron Condors have nice adjustments available to roll the call spread portions to higher strikes next week. Some buffer remains before an adjustment is required but a watchful eye is being kept on them.

Posted-In: credit spread ETF irno condor options tradingTechnicals Options


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