I did make an adjustment to the January Bearish Butterfly yesterday. As per guidelines, I added 10 870 call butterflies. This makes the trade “not bearish” anymore just in time for the nice gap down this morning 😮
Speaking of the gap, I am a bit surprised by it. Did anyone really think there would be an agreement on the cliff? I certainly did not and the markets till this point have been motoring along with very low IV as if no one cared either way. It will be interesting to see if this goes anywhere.
Anyway, the down move, as it is looking right now, should be good for the M3 positions and if it is less than 20 points for the day, we may even be able to hold onto the Bearish Butterfly. We shall see.
I will update you with any changes on the weekly update.