October 21, 2011 Trade Update

Good Evening!

What an awesome day to enter the December trades. I entered both the December bearish butterfly and the December M3 trades today. I made some adjustments on the current positions as well.

Let’s start with the November M3, With this trade I bought another 640/650 call vertical today to flatten the t+0 line. If  RUT breaks out next week as expected, I’ll look at rolling up the 640 butterflies.  The position is currently up $263, I had an initial profit target of $1000 but not sure if that is in the cards this month. We’ll see. The position is shown below:

On the November bearish butterfly, I bought 2 – 670/690 call verticals  to give me a little more upside range in case RUT decides to make a run for 775.  I’d expect it to roll over at 740 but you never know.  Currently the position is down $60 and is shown below:

I entered the December Bearish Butterfly by buying 2 – 630/680/730 put butterflies. The position is shown below:

And last but not least, I entered the December M3 trade and bought 3 butterflies instead of 2 by accident, I’ll look at getting rid of one of them next week, but for now we got 3 –  630/680/730 put butterflies and one 47 IWM call. The position is shown below:

OK, the SPX had a nice breakout today and will very likely make a run for 1265-1270. This should cause RUT to break out next week and make a run for 740. I would think the SPX will roll over before RUT can go any higher than 740 but if SPX breaks deep into the congestion zone, all bets are off. The bulls are back! (at least for now)

Have an awesome weekend!

John