Live: Tuesday, Sept. 10, 2019

4:10 p.m. New York time

And at the closing bell,

  • GLD closes at $140.18, below its short put strike of $141
  • TLT, at $140.69, below its short put strike of $142

IWM, XLY  remain between the short strikes, and XOP has returned to between the strikes, having been above the short call strike earlier in the day.

12:55 p.m. New York time

TLT has dropped below the put options strike price, $142, in my short iron condor position. Action: Do nothing. Odds of expiring profitably, above the strike price, are 80%; unprofitably below, 20%. So far today the low has been $141.83.

11:50 a.m. New York time

GLD has moved below the put options strike price, $141, in my short iron condor position. Under my rules, I use the same tactic as with XOP (below): Do nothing for now.

The position is structured so that GLD has an 86% chance of expiring profitably above the put strike, giving a 14% chance of closing below, in the unprofitable zone.

The low so far today is $140.67.

9:50 a.m. New York time

And the first excitement in the OCT options cycle (although not very exciting).

The price of XOP shares has moved above the short call strike price of my short iron condor on that series. The strike is $24, and XOP triggered an alert when it moved up to $24.13. With 38 days to go before the options expire, on October 18, my response to the break above is to do nothing, and that rule holds until 21 days prior to expiration, on September 27.

And indeed, three minutes after breaking out, XOP withdrew to below the short call strike price. It may break out several times more today, but it will be of little significance at this point.

The position has an 81% chance of expiring within the short strikes (calls to the upside, puts to the downside), which means a 19% chance of closing above or below the range of the two strikes. Still good odds of a profitable play.

By Tim Bovee, Portland, Oregon, September 10, 2019

Disclaimer

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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