Straddle this..........

Here's one the market maker and I are trying to come to terms on today.  Note the IV is still inline with the HV. The last four earnings had nice percentage gaps (gray columns) as well as some nice price movements (yellow trend lines) prior to earnings in both directions. It has now consolidated for the last two weeks and with earnings being a little over four weeks out is is poised to make another move. Trade to trade well. J.R 

Watch List

Not a lot of premium out there for naked puts that meet my criteria but here are a few candidates.  Also have several straddles in place but will cover them more in detail later. 

Weekly Wrap

We hit 60 something this week, degrees on the temperature gauge that is and almost all the snow has melted. So far nothing has melted on the SPX yet. Al though we broke the January highs with a new high of 1153 today it did not hold as we closed just below the 1150, got some heavy resistance there for now with some support down at the 1130.  The weekly however shot right up to the 1150 without much hesitation (see those six consecutive green candles on the daily). The trend line on the weekly corresponds with the 1130 line should we retrace next week.  The monthly shows some signs of consolidating to a possible roll over but since the month is only half over we can still go either way even though the candle is currently bullish it still needs to get over that 1150 as well. I expect next week to be challenging for the market to say the least.  We have reports forth coming on Housing Starts, FED Announcements, Producer Price Index and Consumer Price Index. If that's not enough to knock your socks off it is not only expiration week but quarterly expiration to boot. I love triple witching day, don't you?  So if Mr. VIX can maintain a narrow channel between the 17 and 20 lines for the week then I would venture to say that the 1150 on the SPX shall be conquered, but if he gets way out of hand I would look to the start of that trend line on the weekly for trip back down memory lane. Remember, trade what you see and trade to trade well.   J.R.

Watch List

Pulled down several candidates last night. Keep in mind that although this scan is written for naked puts with tons of support between the price action and the strike price, they are all up trending stocks with an upward monthly pivot point projection as well. There are many ways to to trade these.  Use your own judgement and trade to trade well.

J.R.'s weekly wrap. It's back............

..... the price action above the 50% fib line on the SPX that is.  The $1121.44  is now support at least for the open of Mondays market. The next resistance is that $1150.45 from the highs of January. If we get though that then we are back in line with the prvious trend line from March.  However, if we bounce off that it becomes a double top and I would look for it to slide right back though the 50% fib and be supported around the $1050. The VIX is now in the teens and close to it's support line so look out for some choppy waters coming up. Trade to trade well and enjoy the weekend.

Hi-way safety and bath towels ?

Two straddles we are looking to get into prior to earnings are Bed, Bath and Beyond (BBBY) and (LNN) Lindsay Corp. The BBBY chart shows the last week consolidating back up to the highs of January which will give us a nice platform to launch from in either direction while the IV has not yet been too escalated. On LNN we see a nice break out of the "W' pattern and the price action is right in the middle of the channel that has formed over the last 12 months. Again the IV has not took off here either.  Looking at the historical movements prior to and at earnings they appear to be ripe for the picking.  Again do you own DD and trade to trade well.

Bear and Bull Market

You have seen her in my side bar from time to time explaining Ponzi Schemes so I thought you might like her version of the Bear and Bull Markets. Enjoy.

Bear and Bull Market