August 22, 2017

Archives for July 2007

SPX Short Iron Condor – 10% Profit Locked in for July Expiration Cycle

We are proud to announce that we locked in a 10% profit today in our SPX Short Iron Condor for the July Expiration Cycle. The recent rally pushed the underlying SPX ever so closer to the short call strike of our July Short Iron Condor position. Even though the market was/is in an overbought state (which typically means that upside momentum is limited) we decided to take off the call spread of the Iron Condor strategy today. With two days of the Bernanke congressional testimony ahead and the historically bullish response that follows, we felt it was advantageous to exit the call side of the position. The last 7 times (since 2004) the semi-annual Fed chair testimony happened the market rallied sharply. We are constantly seeking to reduce … [Read more...]

Website Changes

As you can see we are in the process of changing over our website. We should have all of the kinks fixed by tomorrow. Andrew Crowder … [Read more...]

Mid-Year Rally Expected. What Does History Tell Us Now?

The market continued to advance this week, leaving the Dow and S&P at record levels. The advance occurred despite the ongoing concerns in the subprime market and the economy.  The S&P 500 advanced 22.06 or 1.4% to finish the week at 1552.50. The Dow gained 295.57 or 2.2% to 13907.25 and the Nasdaq also finished the week higher, up 40.49 or 1.5% to 2707.00. The Russell 2000 climbed 3.46 or 0.4% to 855.77.  The advance pushed my technical indicators into extreme territory, particularly in the higher-beta indices such as the Nasdaq 100 (QQQQ). Typically, this type of reading limits upside advances and often leads to a short-term (1-5 days) pullback.  All of the major indices are now at an important juncture as they have managed to … [Read more...]

Another Push into Overbought Territory

The market surged higher today leading to the largest one day gain in four years for the Dow (DIA). The sharp advance has pushed the indices we follow (with the exception of the Russell (IWM)) into an "overbought" to "very overbought" state. There could be a fade opportunity to be found in the coming days, but I would tread lightly. The major indices are all at an important juncture as they have managed to push slightly above what has been strong overhead resistance. A move below these levels could stir up the bears and cause a wave of selling, but how long the selling lasts is another question. Being a short-term bear (1-2 days) has been essential in this market as every dip has led to higher highs. The string move has pushed the … [Read more...]

Summer Trading At Its Finest

Buyers viewed yesterday's sharp decline (the largest in three weeks) as just another buying opportunity, however, as I still think the "summer doldrums" will ultimately prevail. The market has settled into summer trading so  range-bound trading with slight expansion should continue. The tech-heavy QQQQ is nearing an overbought state and if the futures stay where they are we could see another test of the recent highs early tomorrow. The middle of July is often a weak period for the market so the overbought readings and seasonal weakness could lead to another move lower.  As for the S&P (SPX & SPY), the major benchmark remains range-bound and as a result, our SPX Short Iron Condor continues to prosper. The increase in premium has … [Read more...]

Condor Strategy Continues to Prosper – Market Already Nearing an Oversold State

The expected decline occurred today and now the major indices that we follow are back in a neutral state. Some of our shorter-term measures are nearing an oversold state so a signal could be near. I was hoping for a flat to higher open this morning that I could fade, but the pre-Bernanke meeting at 1 P.M. EST had traders spooked. The market has vacillated wildy when any fed speak has entered the market so I did not feel the risk/reward was favorable. As I always say "opportunities are made up easier than losses". You can bet that the next oversold reading will bring buyers back into the market and I plan on participating. I continue to remain patient, but admittedly have been frustrated by the lack of signals over the past few weeks. Our … [Read more...]

Same Scenario, Different Day

Again, I apologize for the delayed post. The situation hasn't changed much over the last couple of days. All of the benchmarks that we follow are in an overbought to very overbought state which typically means that upside momentum will be limited over the short-term (1-5 days) and any gains will most likely be given back. Over the past few months every time our indicators would near an extreme we would witness the major indices, particularly the S&P 500 (SPY) quickly fade the extreme (move opposite of the current trend).   Moreover, the S&P is back near a strong area of resistance at 1535. The market has struggled the last few times it has tested the 1535 area and I expect to see a similar reaction this time as … [Read more...]

Severe Lightning

We are having a series of severe storms so I will try and get a post out later tonight or early tomorrow morning. Andrew … [Read more...]

Expect a Short-Term Reprieve Early Next Week

The Independence Week rally continued today on another low-volume day. Buying continued to pressure the markets as the day progressed and managed to finish at the highs of the day. The rise occurred in the face of a sharp spike in the bond yields. The last two days have been typical of low-volume, post holiday trading and I expect once the big boys get back we will start to see some selling, at least over the short-term. Our indicators are at an extreme level which means that we will most likely see a signal in the ETF early next week. Over the past few months every time our indicators would near an extreme we would witness the major indices, particularly the S&P 500 (SPY) quickly fade the extreme (move opposite of the current … [Read more...]

Tech-Heavy QQQQ Overbought

After a few days of some much needed rest I am finally back (although later than I originally stated). I apologize for the shortened post, but I am still getting back into the swing of things after a few days away. The tech-heavy QQQQ is now in an overbought state and our shortest-term measures are indicating limited upside over the next few trading sessions. This could prove advantageous for our ETF Extremes strategy. We shall see soon enough. As always, we will never force the issue regardless of the limited signals as of late. The S&P remains range-bound and at this point I expect to see a similar pattern last through the summer months. Yes, back to the "Sell in May" theory that I have mentioned repeatedly since early May. Our Iron … [Read more...]