The Battle Has Arrived
Let's get ready to rumble!
It kinda feels like it's the night before Christmas. Except in this version, Christmas lasts three days and it's a celebration of high market volatility. It's time to get prepared for the CPI Report, PPI Report & Retail Sales. The icing on the cake is that earnings reports from the banking sector will also be announced (detailed below). Starting tomorrow, Wednesday the 12th, I will be starting my stream around 8:15am ET. I don't want to miss any of the craziness.
For tomorrow, the CPI YoY expectation is 5.1%. This is a considerable drop from the last reported reading of 6%. If the number comes in hot, I'll be looking for the market to sell off. If the market comes in cool, I'll be looking for the market to pop. There's currently a 70% chance of a 25bps hike at the next FOMC meeting (May 3rd).
There will also be a specialty stream tomorrow. At 2pm ET, the FOMC Minutes from the last meeting will be released. Normally, this is boring af, but over the last year they have prompted more volatility than expected. I have no clue what this one will have in store for us, but hey, it might be fun.
Reminder: We are going to be starting a Streetbeat Algo generation competition. It's free to compete, and yes, there will be cool prizes. Make sure you download Streetbeat to your phone, set up your account and use the referral code "MATT" on the initial page for a free $5-$5,000.
Market Events: Wednesday, April 12th
08:30 AM Consumer Price Index -- STREAMING THIS!!!
08:30 AM Core CPI
08:30 AM CPI (YoY)
08:30 AM Core CPI (YoY)
09:00 AM Richmond Fed President Barkin Speaks
12:00 PM San Francisco Fed President Daly Speaks
02:00 PM Treasury Budget
02:00 PM Minutes of FOMC Meeting -- STREAMING THIS!!!
Earnings: April 10th - 14th
Monday: Tilray
Tuesday: Carmax
Wednesday: LVMH
Thursday: Delta & Progressive
Friday: Citi, Blackrock, JPMorgan, PNC, United Health Group & Wells Fargo
Note: This is NOT the full list -- I included the names of companies that are popular within the Goonie Community.
Seasonality Update
S&P 500 Seasonal Bias (April 12th)
- Bull Win Percentage: 52%
- Profit Factor: 1.16
- Bias: Neutral
Equity Curve -->
Current Account Value (April 11th)
$10,372
Daily Realized P&L: +$0
YTD Realized P&L: +$397
Closed Position(s)
None
Current Position(s)
SPY Iron Condor (5) April 14th
- $411/$412 Call Spread --> Credit: $20
- $375/$374 Put Spread --> Credit: $17
- Max Return: $37 & Max Risk: $63
- Current Value: $45
- Profit Target: $15
- Profit Odds: 57%
SPY Iron Condor (5) April 14th
- $413/$414 Call Spread --> Credit: $18
- $380/$379 Put Spread --> Credit: $16
- Max Return: $34 & Max Risk: $66
- Current Value: $32
- Profit Target: $15
- Profit Odds: 67%
SPY Iron Condor (3) April 21st
- $420/$422 Call Spread --> Credit: $48
- $397/$395 Put Spread --> Credit: $30
- Max Return: $78 & Max Risk: $122
- Current Value: $38
- Profit Target: $30
- Profit Odds: 84%
SPY Iron Condor (3) April 28th
- $422/$424 Call Spread --> Credit: $41
- $393/$391 Put Spread --> Credit: $28
- Max Return: $69 & Max Risk: $131
- Current Value: $54
- Profit Target: $30
- Profit Odds: 87%
SPY Iron Condor (3) May 5th
- $424/$426 Call Spread --> Credit: $46
- $397/$395 Put Spread --> Credit: $37
- Max Return: $83 & Max Risk: $117
- Current Value: $80
- Profit Target: $30
- Profit Odds: 80%
New Position(s)
None
My Thoughts
Is the whipsaw price action really surprising anyone?
For 90% of the day, things were seemingly bullish. Then with 30 minutes to go, the market got rugged. We essentially ended where we started -- The premium sellers were once again were victorious.
I'm still sitting on my hands. I explained it better in yesterday's newsletter, but I'm looking to be reactive rather than predictive. This essentially means I'm waiting for market to digest the upcoming reports before I do anything to crazy. I'm still holding the premium I sold, the SPY puts & the TSLA puts.
Get some rest because the rest of the week will be exhausting.
Thanks for reading -- Much Love!
Notes
Max Return (Credit Spreads): The credit received when creating the position. This is achieved when you get to the expiration date and the price is below the sold contract for a Call Credit Spread and above the sold contract for a Put Credit Spread.
Max Risk (Credit Spreads): The difference between the spread's two strikes minus the credit received when the position was created.
Breakeven (Credit Spreads): The sold strike plus the credit for CCS and the strike minus the credit for PCS.
RISK WARNING: Trading involves HIGH RISK and YOU CAN LOSE a lot of money. Do not risk any money you cannot afford to lose. Trading is not suitable for all investors. We are not registered investment advisors. We do not provide trading or investment advice. We provide research and education through the issuance of statistical information containing no expression of opinion as to the investment merits of a particular security. Information contained herein should not be considered a solicitation to buy or sell any security or engage in a particular investment strategy. Past performance is not necessarily indicative of future results. Links above include affiliate commission or referrals. I'm part of an affiliate network and I receive compensation from partnering websites.
Both of these trades hit if held until close -- 6 total units!
Both of these trades hit if held until close -- 6 total units!
SPY missed & QQQ hit
The Trump-China-Trade announcement from the NYT knocked me out of my position. The CCS's were sold at $1.80/ea and I was forced to buy them backl at $4.40 -- This means my realized loss was $3,120 :(
The hedge did exactly what hedge plays are meant to do. It balanced me out! These PCS's were sold at $0.85/ea and expired worthless -- THIS MEANS MY REALIZED GAIN WAS $2,975!
