August 2, 2011 Trade Update

Hi All,

We got another big down move in the markets today; that makes the recent down move  the biggest we’ve seen this year in the SPX. For the RUT however, this is the second time this year we’ve seen this magnitude of a move so it is “same old, same old” as long as we level out soon.

The move down today prompted me to make 2 adjustments.

The adjustment point on the method 3 trade was hit and I rolled the 800 put butterfly back to a 730/780/830 put butterfly. If you remember, I bought the 780 butterfly earlier and then sold it the next day because it was “not in line with my rules” .  Had I kept that position, I would be out of this trade at the profit target, but, I wanted to follow the rule set, so here we are. Currently the trade is at about break even and is shown below:

The other trade that was adjusted was the August method 15.  I sold the 820 put butterfly and bought the 810 put butterfly.  I did this before the selling really picked up later in the day. Had I waited, I would have made a more aggressive adjustment but it is what it is. The current position is down $362 which is still far from the $1200 max loss, so all is good. Position is shown below:

The Sept 55 day trade remains unchanged. I am planning to see how the market reacts to the current support level to decide on an adjustment. Currently the position is up $280 and is shown below:

That’s all for now, happy trading!

John