01/04 Daily Summary

Today we had a strong rebound from last Friday's session, both RUT and MNX posted over 1.5 standard deviations to the upside. I have only one position left for the JAN cycle, and it adjusted itself with contingent orders Today.

Early in the morning I was considering entering an OEX weekly iron condor, as this has been much discussed in California trading group 1 meetings. Despite very promissing backtested and live results, I became leary of the fact that OEX can be assigned before expiration. Since I don't quite know exactly what sort of impacts this fact might have, I decided to leave it alone this week until I can do a bit more research on it... I'm following one of the few overall rules I have for trading: When in doubt, stay out.

Position's Details and price action chart:
01/04 MNX Iron Butterfly

01/04 MNX Iron Butterfly

Phew!! Not a pretty day for this trade. Notice in my dashboard it had 10% at one time, my friend Gary did the right thing, he exited his trades. I've learned my lesson and am no longer going to stick around for 15% on these trades. My goal is now 10%, it is part of my adjustment plan for 2010, more on that later.

So, Today's price action triggered my contingent orders to roll the 180 calls. I rolled 2x 180 to 187.5 call, and sold one of the 190 FEB calls I had in inventory. I have orders to continue to roll if we keep pressing higher. One nice thing was that the trade fixed itself with the contingent orders, I spent the day busy with work and didn't even look at the position all day long.