Remember, This is a Marathon and Not a Sprint
May 28, 2009
Yes, I am finally back on the blog after what seemed like an eternity on the Insiders Page. For some reason it is just much more fun writing on the blog and I hope it inspires me to write more frequently in the future.
As for the strategies, well, it has been quite some time since our last trade. While I am not concerned (just look at the overall performance over the past three years while the rest iof the market has been tumbling) I know many of you have issues with the lack of trading. As it states on the website, the ETF Extremes strategy can go months without a trade, ultimately it is the long-term performance that matters. If you are looking for a short-term fix then this is not the strategy for you. I have seen way too many options strategies do well over a course of a few months only to blow up and then proceed to take heavy losses. I will not accept that as a strategy. I am in this for the long haul. Remember, this is a marathon and not a sprint.
Overbought-Oversold levels for May 27, 2009
ETF Extremes Options Trading Strategy
* S&P 500 (SPY) - 46.3 (neutral)
* Dow Jones (DIA) - 43.6 (neutral)
* Russell 2000 (IWM) - 52.0 (neutral)
* NASDAQ 100 (QQQQ) - 60.6 (neutral)
Other ETFs
* Ultra Long (SSO) - 45.7 (neutral)
* Ultra Short (SDS) - 51.5 (neutral)
Upcoming Holiday Bias and the Iron Condor
May 19, 2009
The market shot back up today and into what I consider an area of strong resistance at the 910 level on the S&P. As seen below the indexes are currently near an overbought level so I expect to see a short-term pullback. Moreover, we are entering a period of holiday seasonality that has historically displayed a bearish bias leading up to the holiday and a strong bullish slant two to five days after the holiday. I think history could repeat itself again this year but nly time will tell. For the moment, I am watching the 910-875 are in the S&P and a breach and hold above/below those levels would lead me to look further into the next short-term move.
A move back to a firm neutral state should lead to our first official Iron Condor trade (Insiders Only). I will have more details about the specifics of the trade tomorrow, hopefully intraday, but don’t hold me to it.
Overbought-Oversold levels for May 18, 2009
ETF Extremes Options Trading Strategy
* S&P 500 (SPY) - 60.7 (neutral)
* Dow Jones (DIA) - 64.1 (neutral)
* Russell 2000 (IWM) - 56.5 (neutral)
* NASDAQ 100 (QQQQ) - 60.6 (neutral)
Other ETFs
* Ultra Long (SSO) - 60.4 (neutral)
* Ultra Short (SDS) - 37.2 (neutral)
