Well 30 points OTM on your SPX no touch with about a little over a week. Seems like a winner at this point since the bulls do not want to concede 1245 without something more significant to push it down and the only significant thing likely to do that will occur after expiration. Is the plan to hold until the 20th or if the value reaches $750K maybe take an easy stand-up triple?
$750k would require another 20-lower on cash. Fine, but I'd prefer a nice, leisurely drop to 1240 cash. Anything more than that will keep me up all night.
Why would a drop make the no touch at 1225 more valuable. Wouldn't just churning around make it more likely to not touch 1225 and therefore increase the marked to market value?
Well, I feel better now, but it was ill-advised to offset the hedge. I was on the road this morning and missed the retrace. I didn't want to keep a resting stop and have it reverse. I feel fairly confident we'll not break 1229 on cash. I am less comfortable with the upside risk of selling 850 ES to hedge strong than I am letting the 1225 barrier ride.
I've got the vanilla 1220s and 1210s. 3 days to go. I'm concerned with a knee jerk tomorrow with the cpi though.