SPX Credit Spread Trader

Actually, no. I'm only looking to get out before the SET. On Wednesday and even Thursday morning my limited experience seems to suggest that there is still significant premium on SPX options that are 5 to 15 points OTM. But by one hour to the close this premium vanishes. So it might not be a bad idea to wait until the last hour, if the SPX is not moving much and particularly if it is moving in the opposite direction of your short.

Quote from rjg96:

Rdeyman-

So, you're planning to buy straddles if the put/call premiums are around .05 ATM? You're thinking that triple-witching could bring some big moves for SET, thus giving you a nice little profit? I like this idea-- rather than being scared of the SET, embrace it. :)
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Forgot to add to the below chart that 1263.50 seems to be the resistance point indicating a breakout and 1252.50 on the downside. A breakout alone is not enough to confirm a continuation of the uptrend. Any pullback cannot fall back into the triangle and/or move lower or that is an obvious false breakout. The market swings after a FED announcement can be wild so even if it exploides higher, I would expect it to retrace and that is where you have to watch it closely.




Quote from optioncoach:

Interesting chart pattern on the SPX attached. Looks like we have entered into a consolidating triangle after the long run-up from OCT which could be resolved on today's FED news. Based on the triangle measureing characteristc that it is the half-way mark of a trend, it would forecast a continuation move to 1350 if it breaks out to the upside. That is quite bullish so I doubt it but in a more relevant sense a resolution to the upside forcasts a continuation of the uptrend unless that triangle is broken on the downside again.

So another reason I am hesitant to look to calls for JAN ;)

Phil
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Attachments

Just IMHO, but I think they're going to signal an end to the tightening, but that's the overwhelming consensus. Expecting some 80-point Dow swings at minimum.

I think the Nov-Dec rally was based in large part on buying the rumor of this meeting. I think we're nearing the end of the rally.

Vols are very well bid across the globe.
 
Basically I have my futures order screen filled out for an order at market and will hit buy or sell once the large swing occurs and ride the middle for a point or two ;)


Quote from riskarb:

Just IMHO, but I think they're going to signal an end to the tightening, but that's the overwhelming consensus. Expecting some 80-point Dow swings at minimum.

I think the Nov-Dec rally was based in large part on buying the rumor of this meeting. I think we're nearing the end of the rally.

Vols are very well bid across the globe.
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Awhile back I posted that historically after the Fed signals that there is an end to the tightening the market has an average XX% increase (the time frame would have been over months not immediately after the announcement). I've been searching through my posts and can't find it. I think it was a quote from some talking head on CNBC and I think the increase was 5%.

Anybody remember that post, because I'm curious as to how much increase in the market we might expect if the Fed signals an end to tightening today.

Quote from riskarb:

Just IMHO, but I think they're going to signal an end to the tightening, but that's the overwhelming consensus. Expecting some 80-point Dow swings at minimum.

I think the Nov-Dec rally was based in large part on buying the rumor of this meeting. I think we're nearing the end of the rally.

Vols are very well bid across the globe.
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5% would certainly coincide with the price projection I made off the consolidating traingle in the chart I attached above but I do not have a time frame. The best guesstimate would be 2 months which was the length of the run up. But this is back of the envelope.

Quote from rdemyan:

Awhile back I posted that historically after the Fed signals that there is an end to the tightening the market has an average XX% increase (the time frame would have been over months not immediately after the announcement). I've been searching through my posts and can't find it. I think it was a quote from some talking head on CNBC and I think the increase was 5%.

Anybody remember that post, because I'm curious as to how much increase in the market we might expect if the Fed signals an end to tightening today.
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lol. Here:

http://www.elitetrader.com/vb/showthread.php?s=&postid=869308#post869308


Quote from rdemyan:

Awhile back I posted that historically after the Fed signals that there is an end to the tightening the market has an average XX% increase (the time frame would have been over months not immediately after the announcement). I've been searching through my posts and can't find it. I think it was a quote from some talking head on CNBC and I think the increase was 5%.

Anybody remember that post, because I'm curious as to how much increase in the market we might expect if the Fed signals an end to tightening today.
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Well that was a fun 1.5% in under 30 seconds LOL..... Went long on the breakout and closed and then shorted and covered..



Quote from optioncoach:

Basically I have my futures order screen filled out for an order at market and will hit buy or sell once the large swing occurs and ride the middle for a point or two ;)
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