Live: Thursday, May 23, 2019

3:35 p.m. New York time

XOP has moved below the profit zone, signaling that under my rules, I might take the loss. A tentative addition to my trading rules, as modified, says:

If more than half of the 1SD range is beyond the profit zone in the tested direction, then exit the position. If the price moves below the profit range and the number of days required for the price to return to the profit zone, as measured by the 14-day Rate of Change, is greater than two days, then exit the position.”

At present, XOP’s one standard deviation mark is 7.1% below the profit range, and the time taken to return is 0.65 days, or about two-thirds of a trading session. So, as to an exit, not today. But XOP will need close watching. The current price of XOP shares is around $27.08, and the lower boundary of the profit zone is at $27.47.

10:10 a.m. New York time

As I did the first three days of the week, today I have once again entered an exit order for my short iron condor IYR, for $0.19, with the bid/ask midpoint at $0.18. I shall keep doing that as long as the midpoint is at 40% of maximum potential profit or higher.

My positions are due for an exit or management eight days from now, which will be 21 days before expiration on June 21.

By Tim Bovee, Portland, Oregon, May 23, 2019


Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decisions for his or her own account, and take responsibility for the consequences.

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