Nope in this journal these are just the flies by themselves. The ES hedge is a trade I sometimes do in my other account but for the purposes of this journal, my Roth isn’t approved for futures and in order for my broker to allow futures trading in my Roth, I need to bring up the equity to $25k. So $25k is my short term goal here.
Closed trade 9 for a quick buck: tIP SOLD -1 BUTTERFLY SPX 100 (Weeklys) 28 FEB 20 3295/3270/3245 PUT @2.90 CBOE +$130.84 Profit Starting Balance: $1001.75 Current Balance: $1783.83 Cumulative PnL: $782.08 = Account up 78.07%
Last week we saw a 7 standard deviation move to the downside in the S&P's. Statistically speaking, that's as close to impossible as we're gonna see. After a crazy week last week, I'm playing for a bounce. Dead cat bounce or otherwise, I want to be part of that upside move. Trade 10: tIP BOT +1 BUTTERFLY SPX 100 (Weeklys) 6 MAR 20 3120/3145/3170 CALL @1.30 CBOE I think there will be fed talk in the backdrop hinting at a cut. I also think there's a good chance Jerome will come out of the depths with a surprise cut to "save the day". I look at this chart almost on a daily basis. The fed fund futures are already pricing in a 100% probability of a rate cut with a 70% chance of a 50 basis point cut by April FOMC. But this doesn’t mean the pain is behind us. Longer duration, I’m still a bit hesitant thinking we’ve even come near the bottom. 4 months ago, the markets were at these same levels and we were calling them all time highs. There still a long way down if conditions intensify.
I just realized I read this wrong. The market is pricing in a 100% chance of a 50 bp cut by march and 70% chance of a 75bp cut. Crazy!
Good to hear from you. I like the trade. Your fly is marked around 2.35 now. I'm wondering where are you getting that Fed Fund Futures table?
The CME group publishes this here: https://www.cmegroup.com/trading/interest-rates/countdown-to-fomc.html I closed out the trade for a small profit. The fed cut rates today but the market sold off on the news, invalidating the trade. Still was able to get out for a small profit, albeit minimal. I still believe there's a good chance this fly would have hit, but when the market sold off today on the fed news, I didn't want to risk staying in. Trade 10 closed: tIP SOLD -1 BUTTERFLY SPX 100 (Weeklys) 6 MAR 20 3120/3145/3170 CALL @1.70 +$35.84 Profit Starting Balance: $1001.75 Current Balance: $1819.67 Cumulative PnL: $782.08 = Account up 81.65%
In case you didn't notice, I'm using this thread to post my thoughts and opinions on the overall market conditions on a week to week basis, which is what drives my trading strategies. Another crazy week behind us with volatility not backing off a bit. Based on this weeks price action, I'm positioning around the SPX pinging back and fourth between 2900 and 3100 before picking a direction. The VIX is making new highs today while treasury yields hitting new lows. All eyes today are on the bond market, with the 30 year ZB gapping up 3% in the overnight session. Moves like that are unheard of in the bond market. The 10 year was bottoming out during todays trading session at .66%. This spells trouble for the financials, which has been driving the sell side activity. Defensive sectors such as utilities and consumer staples remain the outperformers in this volatile marketplace. Trade 11 Open: tIP BOT +1 BUTTERFLY SPX 100 (Weeklys) 13 MAR 20 3075/3100/3125 CALL @1.75 CBOE I'd also like to note I posted this when we were still at all time highs literally the day before the market tanked. Couldn't have called this one better. Things aren't over people, they've only just begun.