Today I bring you Sectors $XRT $XLF $XME $IWM
Updated
XRT - Retail Sector (Non Market Cap Weighted)
XLF - Financial Sector (Market Cap Weighted)
XME - Mining Index (Non Market Cap Weighted - US Miners only)
IWM - Small Cap (Non Tech Giants)
First The critical levels shown on Right Charts are something to be very mindful off.
The Product must hold support for the SPX to move higher. But a Crash in the SPX market wont happen without Russell 2000, QQQ will have to lead the market to a crash. Not happening at this point, I boycott trading short side on QQQ.
These products are Ready to Pop.
I personnally think they are going to breakout and fade back.
For someone who want to make money on this. Build a Spread (OTM), ensure that the IV is in your favor.
In a Nutshell, My analysis is - XLF, XRT, XME all going up, while the QQQ walk down a few steps,
SPX and IWM may have a slight p/b (UCS#2 Long Entry) and then run higher with QQQ.
A Crash right now, although would be great for my account. Is highly unlikely.
XLF - Financial Sector (Market Cap Weighted)
XME - Mining Index (Non Market Cap Weighted - US Miners only)
IWM - Small Cap (Non Tech Giants)
First The critical levels shown on Right Charts are something to be very mindful off.
The Product must hold support for the SPX to move higher. But a Crash in the SPX market wont happen without Russell 2000, QQQ will have to lead the market to a crash. Not happening at this point, I boycott trading short side on QQQ.
These products are Ready to Pop.
I personnally think they are going to breakout and fade back.
For someone who want to make money on this. Build a Spread (OTM), ensure that the IV is in your favor.
In a Nutshell, My analysis is - XLF, XRT, XME all going up, while the QQQ walk down a few steps,
SPX and IWM may have a slight p/b (UCS#2 Long Entry) and then run higher with QQQ.
A Crash right now, although would be great for my account. Is highly unlikely.
Note
If you know me, I build Min Risk Positions on Options. BUY +1 1/1/-1 CUSTOM XME 100 (Weeklys) 14 AUG 20/14 AUG 20/14 AUG 20 20.5/21/18 CALL/PUT/PUT @2.20 LMT
Heres an example of a Modified Back Spread (Done for a Debit) - Risking 200 with profit on both side. This behaves exactly like a BS.
Note
The Implied Volatility structre wont let me execute a Vertical Spread. The Volatility here favors Buying Vol kinda trade. Yet, The IVP is almost 40%. Tough Decision. I also like a short term Iron Butterfly here.
Note
Ok, Build the entire position. Bearish on XRT (Hedge)
Bullish on XLF and XME.
IWM - On Watch for now. Holding Mostly Bullish position with Hedges.
Note
Shorting QQQ would have been better than XRT. But hey, Hindsight is always correct,Note
XRT - Hedge is coming close to a $0 risk trade for me. Might be legging out today on the profitable side. Essentially reducing the cost of my Hedge to -0.2 per contract. Still holding XLF and XME.
XLF - Raising wedge pattern. So manage accordingly.
Note
Looking to close the Long positions this week.
Uday C Santhakumar
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