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The market stayed amazingly firm, considering the uncertainty from the FOMC meeting next week (July 26+27). I remember many instances where the market unraveled the week before the meeting because investors suddenly realize "oh, crap, there's a rate hike coming up next week".
I will tread cautiously with the Friday expiration (and likely the Monday and Tuesday as well). Once the statement is out and the press conference is over, everything will calm down again!
@earlyretirementnowcom think GDP announcement on 28th is a concern? Likely will be the second qtr of negative growth, so in recession.
@navypack 2 2Q negative GDP growth rule is not the correct definition. Business cycle timing is done using monthly series for employment, industrial production, income, and wholesale trade. We may indeed observe 2 negative quarters without a recession.
Completely off topic, but for some reason I can't seem to get forum notifications. When I click on "subscribe for new replies" I get an error that says "Can't send confirmation email" (see attached image). Any help/insights would be most appreciated.
@mpaziran Good question. I don't have an IT professional to look into this, though. Sorry!
I had two close-calls this week. The first one, on Monday, I had the 4125 strike for that day. The SPX was $5 from the money at some point. Luckily, I kept my cool, and it expired OTM. The second one, on Friday, I had the 4030 strike. The SPX closed only $20 OTM.
Unfortunately, I sold new contracts on Friday when the sell-off only started. First, I had the 4015 for Monday. I eventually closed that one at a small loss and rolled to 3945, thinking I was safe below 4000. However, the market continued to fall, and I got scared and closed that second contract, too.
Closing that 4015 strike looks like a good decision for now, because it quadrupled in value since I bought to close it. Closing the 3945 strike might have been an overkill. All in all, the last three months were very good, and I came close to climbing out of the drawdown from April and May. That's why I don't feel too bad with realizing small losses.
Monday will tell whether I was right or wrong.
I hope everybody here had their puts expired OTM and have now written on some super OTM, completely overpriced contracts.
@ohadost I had some small losses on some of the intra-day puts I sold in the morning. In exchange, I sell the nest-day puts at a slightly smaller premium and further OTM.
I've had some small losses in the last two weeks when the intra-day moves went against me and I closed the trades when they became too dicey. But no major loss.
This upcoming week (9/12-9/16) will be again the week prior to the FOMC meeting (9/20-9/21). Expect higher volatility! And potentially people losing their marbles again when they realize that another 75bps hike is imminent. That often happens on the Friday before the meeting!
@earlyretirementnowcom So far, the markets are rising and the futures markets are firming up on a 0.75% hike. These would seem to be contradictory moves from very different investor demographics.
@earlyretirementnowcom oh boy people lost their marbles again! Just goes to show, bond traders are smarter than equity traders. Got the 3550p(!) for tomorrow (9/14).
Should be some bigger Vol (and premium) at close based on CPI announcement tomorrow before the open.
@navypack There was, and it wasn't big enough (:
Most vol sellers got trainwrecked today.