Options – week of Oct. 12, 2015

Commentary for last week

151012-weekly prices

The SP500 mini futures (ESZ5) had a second short squeeze move after the price moved above 1991. The minutes from the Fed meeting strongly suggest no rate hike this month and that goosed the US stock markets, although some Fed members insisted that an increase is possible soon.

But the Fed has said this before, and the market simply doesn’t believe th Fed will increase rates soon… if ever.

Trading results last week

The trigger price for our Puts was never hit and we made no trades. We took a loss on our 1995 Calls and covered the position buy going long one contract. Our 2025 Calls expired OTM and we retained the premium.

Here’s the annotated chart:


This week:

ES has already had a 146.50 point rally from the 1861 low made Sept 29 to last Friday’s closing at 2007.50. That took 10 trading days. It also has a 176.50 point gain from Aug. 24 to current close. That took 34 trading days. It also is a 58% retracement from the Aug. 24 low to the May 20 high. The price almost reaches short-term overbought territory, and this week we could see a short-term top formed.

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