Thursday, September 22nd, 2016

Index Option trading 2009

Holidays over and we are back to work on Jan 5 2009. During the holidays we had our vacations trades on and reaped decent profits on WALMART and AAPL all given in member’s subscriber area. We still have one trade on WALMART that should expire this week hopefully with profits. All in all the markets did well, and swung high as there were no bad news and bad numbers numbers around.  But those conditions made the markets overbought in just a few days time. All major indexes SPX, NDX, RUT moved above their 50 day moving averages. This technically and cumulatively was a good sign and has given hopes to many traders that 2009 will not be a  horrific year like 2008.

But it did not take long for the market to turn sour, as bad news, and unemployment reports poured .The numbers on unemployment report were atrocious  and the rate shot up to 7.2% first time in many years. This dampened the enthusiasm of many traders and the markets started slowing selling off but in a very orderly fashion. This too, was necessary, because the stock market was so overbought it couldn’t have moved up higher under those conditions. This of course was another reason we saw some selling in the last few days when all the traders came back fro vacations.

We have been trading cautiously. There is this hit and run type trades or swing trades that last few days to one week or so all in all. WMT free trade is an example that we have done in the past 2 weeks over the holidays which was a great time to sell premium and enjoy 20 % returns in under 10 days of peace and quiet. Not so anymore. If these markets stabilize here we should be able to place our monthly IRON CONDORS  on indexes this time and drive some income our way soon. Index options trading is still somewhat unsafe with those long and static positions when the market direction cannot be certain.

We also welcome new members who have joined us in 2009, and hope you will do well this years. If  any of you have not done so, and wondering what you would like to do,  please subscribe to our newsletter, and have full access our members area. This year I am hoping would be different. There is money to be made.


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