July 30, 2011 Trade Update

Hi All,

As the market was pushing down on Friday morning, I, unfortunately,  made an early adjustment to the September method 3 trade and bought 2x 730/780/830 put butterflies as I was planning for a test of support at 775. Soon after I bought the butterflies, the market reversed hard and changed my opinion. The good news is that, at the end of the day, the butteries I bought were up significantly, even with the adverse price movement. The bad news is (at least for this position) that it appears the market is reacting very favorably to the news coming out of the debt Washington and we will likely get a fairly large gap up in the morning which will hurt the new position. As of close on Friday, The method 3 butterfly was up about $ 160 and is shown below:

I also made a minor adjustment to the Aug m15 trade after the bounce. I rolled it back another 10 points to a single 770/820/870 butterfly. I was able to sell the 830 butterfly for the same amount I bought it for $18.95 which was way away from mid price and then got filled for $0.90 less when I bought the 820. That was very unusual, but I’m not complaining. The position was showing that it was up $300 on Friday after the close but the t+0 line is obviously not correct so that number may be off.   The new position is shown below:

The Sept 55 day trade remains unchanged.

That’s it for now, tomorrow should be an interesting day!

John