01/08 Daily Summary

The broad market moved higher Today, I executed my plan on the MNX and plan on staying in the trade till Monday. Next week I plan on entering the OEX weekly condor as well as will start preparing for my FEB allocationsFor now, sit back, relax and enjoy the weekend.

Position's Details and Price action chart:
01/08 MNX Iron Butterfly
See also: 01/07 Possible options for riding through the weekend

01/08 MNX Iron Butterfly

MNX pushed up Today, I had a meeting at lunch time, so I reviewed where MNX was trading and created some contingent orders to roll my 187.5 calls to 190 as per my plan from Yesterday. The orders had a time trigger for 20 min. prior to closing and a price level (at or above 187.50). I also had an order to roll the PUT side down if the market was trading around 188. By combining these two orders, I basically satisfied my Yesterday’s plan (see scenarios a and b).

01/07 Possible options for riding through the weekend

Bellow are a few possibilities, depending on where we are trading Tomorrow.

01/07 Daily Summary

The market started trading down this morning, but found buyers and closed higher on most indexes. NDX did not follow it and failed to post a new high. As I still am in the MNX position, I proceeded to roll some of my calls to move them Out of the Money (aka condorizing). If I find a good way to do it, I might set something up where I can stay through the weekend.

Earlier in the morning I posted a possible condorizing sequence. Just an exercise worth doing when you get to this point of the game, I was able to execute the first 3 steps, 2 in the morning and the final step at the end of day. It was a good thing to have it mapped out, as I didn't have the full TOS application available and executed the last vertical spread (1x 185 to 190) via the web-based platform.

Position's Summary and Price Action:
01/07 MNX Iron Butterfly
01/07 MNX Iron Butterfly - Condorizing sequence

01/07 MNX Iron Butterfly

I've continued to condorize the position, my goal is to move my short strikes Out of the Money (OTM), it is fairly hard to do given the fact we're trading just around my long strikes. I'll look into ways to continue in the trade through Monday if still feasible.

My game plan for Friday if we trade 1 st. deviation higher is to move both 187.5 calls into 190 and ride the weekend. If we stay around this range I might peel spreads off with strangles and straddles.

01/07 MNX Iron Butterfly - Condorizing sequence

The most interesting part of this job is the mental challenge when it comes to the end game. There are no 1-2-3 set rules, just some guidelines. My goal is to "condorize" my position, moving the short calls and puts as far away as possible from the current price, so that the trade can stand a wide swing and still come out profitable.

While you do some condorizing, it is important to be ready to execute the trades in a certain sequence and without much hesitation, specially if your time is limited and the market is active. I've been giving some thinking and bellow is a possible option, provided we stay at these levels towards the end of day, that will be my condorizing sequence.

Things I learned while condorizing:
1) Take it one step at a time, look at your greeks in the final stage and as well as the in-between stages of the process. Never expose yourself to a large delta one direction or another
2) Consider how easy it is to get filled on some orders. The rule of thumb is single orders are easier than 2 contract spreads and those are easier than 3 or more contract orders
3) Try to keep a balance in the sequence (i.e. intercalate single orders with spread orders)
4) Work to simplify your inventory (i.e. preffer to sell rather than buying)

01/06 Daily Summary

Up-side wave cycle seems to be loosing some steam, I plan on entering a bearish Iron Butterfly on NDX if we close on or bellow 1860 Tomorrow. I'm watching and eager to play a down-side wave on the 5-day volatility chart. Have started to condorize my MNX Iron Butterfly, it improved Today and if we keep going down a bit further it will be great!

Seems that missed out on the OEX weekly this week, no problem, the good thing about the weekly trade is that the next week is just around the corner..

Position's details and price action chart:
01/06 MNX Iron Butterfly