No Movement But Very Interesting Place To Short

This really seems toppy, yesterday was strong but then we fell back ending up 5 points in the S&P. We have really had no movement despite the strength, but we haven't gone anywhere. However, the short bond trade worked out yesterday, and I think you can sell them on any rally. Gold is seeing more strength than I thought but wait just a bit and we can see it fall as well, also then yen still looks like an interesting long so don't be discouraged by the strong downtrend, but you can sell it for sure on higher prices. Unfortunately, and it will be hard for me to admit this, but I did sell my covered write in VXX because of the larger risk than I would of liked. However, I have reinstated a wide vertical spread and hopefully that will make up, I also did the same in UVXY...so I think I am good for now. I actually sold some puts in CLF with a 68% probaility OTM so hopefully that can stay range bound to up even if the markets fall, and right now I would definitely be reducing my risk in short puts because there is so much downside risk in stocks right now. Otherwise, the stock of interest right now is TSLA considering all the volatility, there may be room for lots of different plays in TSLA, but Non directional short premium looks very attractive.

Basing? Maybe it is something?

 Well we have some basing action. Hopefully it means something, but I can of like this general level in the ES considering it is kind of where we started the fall. So, hopefully markets fall and we can get some vol coming in, but for now we are stuck with it. Otherwise, bonds look like an interesting short, but I am not sure about gold. Natural Gas looks like an interesting short term long, maybe a dead cat bounce. Oil I think can be played to the downside, but be careful with that considering all the middle east stuff going on, and last I think 6j can be played to the upside on some more weakness.I tempted to put in some bearish positions in my account but I would need to pair it somehow. However, I am not really sure what positions I will be putting on, but I should eliminate some of my delta risk. I would enjoy having more theta but it is hard in this kind of market to get some decent time decay without taking risks I cant take. I am not really sure what to do here because if I did some more trades I would increase my delta risk, which I don't need or want, but again I need theta. So, this market is being a little tough on traders, but we should see some mean reversion. So, don't gloom and doom to much, be happy, so just do your best as I am and lets hope to see some vol.

Early Market Wrap

I still say you should stay short this market. Even people who are long but know what they are doing are around break even this year. So, my point is this has been a very tough year for traders. It would be really nice to see the market fall a bit so we hopefully can get some impl vol in this market. Once again I have been tempted to get long the VIX. I covered some short puts and verticals I had for a small profit and I have entered into a covered call positions in VXX. To make sure that doesn’t eat into possible upside profits I have initiated another covered call position. I a have a few bearish positions in IWM, QQQ, the and SPY. I did a hedge trade in DIA by buying a call spread. I still have some non-directional premium in the GDX and NEM, despite my worries of gold falling. It may be a good Idea to reduce the risk of my shorts, but I could use a few more positions so I could do that easily. Otherwise, my general thesis is short bonds coming into 136, short Russel, long S&P against that, and some long stock positions to hedge my short index trades.

Close Your Eyes and Sell Them

I really think you can close your eyes and sell the S&P's. Now of course we need to be smart about that using pairs and options strategies, but the S&P is really over extended. Considering that all the moves in the market seem to be happening after hours this is a weird rally. We don't see any intra-day strength we just see chop, and nothing else,except for today. I think what is likely to happen is people get bullish up here then we start falling. I really don't see the ES moving much higher. I really like the SPY-IWM long pair where you but SPY and short IWM with a little skew to the downside. It would probably be better to do that with futures though so ES-TF. Otherwise, I have moved out of bonds and gold, but I am keeping a small position in FXY (short OTM put spread). I have many stock positions, and I have a positions in Brazil (short put spread again). The only gold exposure I do have is some non-directional iron condors in NEM and GDX. To get short S&P's I have a couple bullish positions in volatility, and I have some positions in leveraged inverse ETF's such as FAZ. I really like the slightly bullish calendar spread in UNG however. There really is ample opportunities for premium plays in it. In oil I am tempted to short but it seems dangerous. For now, Oil could have a lot more upside, and gold and silver a lot more downside. Bonds I am not sure, but all I will say is that interests rates could easily rise, despite the fed.

Haven't we seen this before?

Haven't we seen this before where there is some congestion at the top of a S&P move and then a big fall down. I think traders should be selling rallies right now and getting a little flatter on dips. It is best to stay short the market up here in the S&P's. Oil also looks interesting so I am might be willing to do a trade in the USO ETF. However, for me I would need to put in a bearish position and there isn't a whole lot of premium in the calls, but if someones want to trade the futures it is very possible to sell some crude oil futures. Gold looks like a buy if it tests it's low of 1197, but for now I just want to sell premium in gold, without taking a whole lot of directional risk. For a gold position I have sold the NEM 24,26,32,34 Iron Condor and I am working another order in GDX. Interesting stocks to play in are BBRY (I am short a wide put spread in), WLT (Short OTM Puts), CLF, NEM, and GDX. For the major markets I am mostly bearish, but I would be careful getting heavily short into a holiday week.