June 27, 2017

Options Strategies Continue To Shine In This Volatile Market

I am going to keep it rather short tonight.

The market moved lower today, but the bears had a rough time pushing the major benchmarks decisively lower. We could still see a push lower, but over the short-term the direction leans towards the bulls.

However, there are a few international ETF’s that have pushed into an oversold state and a few could be potential plays going forward. Currently EWZ, EWP and TBT are on my radar for short-term plays and as always I will inform all of you (my paid subscribers) in real-time if and when a trade occurs.

New Credit Spread Options Strategy – Beta

The two week push by the bulls has pushed the value of my credit spread to approximately $.51 which is $.17 higher than my original price. For all you newbies, since this is a credit spread I have to buy the spread back so the spread is currently down $.17. I sold the spread for $.34.

Thirty-eight days remain until August options expiration so time decay hasn’t truly set in, but once July options expiration occurs (end of this week) theta (time decay) should begin to ramp up. Couple that with another steep push lower and I would expect to see premium get sucked out of the spread. If this does occur I plan on taking off the spread for a decent profit. Certainly a nice way to start the strategy.

The Strategy

Again, I like my new strategy because now both of my options strategies are working in unison. I am able to collect premium in the Credit Spread strategy while patiently allowing time decay to works its magic. And, while I allow the time decay to eat away at my credit spread I am able to play short-term extremes in the ETFs I follow in the High-Probability, Mean-Reversion strategy. Intermediate and short-term options strategies at work.

Just like diversifying a portfolio of stocks, you should do the same when investing with options – diversify your options strategies.

Here it is: the first trade in my new Credit Spread Options Strategy, officially named Crowder’s Credit Spreads. I will continue to go over the trade in full detail in the Free Weekly Options Report.

Market Mumbo Jumbo

Summary

SPY remains range-bound!

Nothing New Here: Not much has changed over the past few weeks – range-bound trading persists. I appears we could see the markets move sideways for a few more months. Are the summer doldrums already upon us? How long can SPY stay in this range of roughly $126 to $137? The question is, while I continue trading extremes in the HPMR strategy , how can I take advantage of the range bound movement at the same time. You guessed it – a credit spread! I will discuss this further in Weekly Options Report.

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Options Strategy Indicator – Overbought / Oversold Extremes

High-Probability, Mean-Reversion Options Indicator