Here's what I'm looking at for next week:
VIX/VIX PRODUCTS . VIX finished last week at 16.50. I will look at VIX/VIX product setups early next week depending how the "horse does at the gate" (Monday). If we see a tight range in the S&P like we did pre-Draghi in prepation for FOMC, VIX could drift go a little lower Monday through Wednesday, in which case I will...
Gotsta go where the volatility takes you when premium selling, and it's still in oil and gas ... .
Here are the metrics for the setup:
XOP April 22nd 24/33 short strangle
Probability of Profit: 70%
Max Profit: $107/contract
Buying Power Effect: Undefined
Break Evens: 22.93/34.07
As you know I trade D-levels and I usually dont care so much about harmonics but this time could be quite good chance to long this chart at the shown area. The XOP alone WILL power this chart up when its reached, there is no question about that but if we get a bit help by the harmonics folk we could be in for some seruous upside :)
With an implied volatility rank of 76 and an implied volatility of 56, an XOP short strangle is a good premium selling play here, with the standard 45 day setup yielding about 1.00 in credit for only $275 or so worth of buying power.
Here's the setup:
Feb 19th 23/32 short strangle
Probability of Profit: 71%
Max Profit: $97
Buying Power Effect: ~$275
I will be accumulating $XOM Exxon Mobil below $81 as a scale in. Approx $80 down to $78 is a zone that is showing a high probability of at least a significant bounce. Currently XOM is signaling accumulation. It may turn into something more. My strategy is: I'm wrong below $75 and/or scale out some with profit at $85 and move my stop(s) up. This is a risk...
Crude oil wti futures on approach from above to linear trend line from Dec 1998 to Nov Jan 2009 extended to present. Should see a bounce or stabilization at least. Need to re analyze as condtions in this market are NOT normal. Caution on the long side. Likely short covering. Activity slowing down upon approach. Over night likely to have the move.