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Weekly Report 2021-09-05

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WEEKLY MARKET OVERVIEW

Following its breakout to all-time highs on Friday of the previous week, the S&P500 (SPY) has been on a steady upward trend for the entire week. Now it's just a matter of seeing when this bull market will take a break, and how severe the correction will be. Of course, until that happens, we can keep riding this long-running up-run wave, but we must be prepared with an action plan when the wind inevitably changes direction.

After the small caps dominance of the previous week, this week's market rotation has seen money flowing into mega-tech stocks.

Weekly market performance (Week 35/2021)

S&P500 (SPY) +0.63%
Nasdaq100 (QQQ) +1.47%
Dow Jones Industrial (DIA) -0.12%
Small Caps (IWM) +0.68%

After a further drop on Monday, the Market Volatility Index (VIX) has been in the 16-17 level range for the whole week.

 

WEEKLY OTC TRADING JOURNALS 

Here is a recap of last week's activities in my Trading Journals for each of the four official options strategies I trade within the Options Trading Club (OTC).

Full disclosure. I have complete personal involvement in the positions listed in my Weekly Reports. These are the real results of trades I make with real money in my trading account and share in real-time inside the Discord Chatroom.

 

Cash Secured Puts (CSP) Strategy

This has been another reasonably quiet week for my CSP Strategy portfolio.

On Friday, I let expire worthless the MU 09/03 CSP $69, keeping 100% of the premium for a 37% AROI in 21 days, while I rolled out MU 09/03 CSP $74 to 09/10 for an additional $0.74 net credit.

On Friday, I also rolled out QCOM 09/03 CSP $145 to 09/10 for an additional $0.96 net credit.

So far, inside my CSP Trading Journal channel, I have closed a total of 46 winning trades with ZERO LOSSES since the launch of the Options Trading Club at the end of May 2021.

 

The Wheel Strategy (WS)

After allowing assignment on ARKK on 08/20 at the $116 strike, with the stock bouncing back up, I opened a $124 covered call expiring on 09/03. Because the stock has been heading higher all week, the trade was about to expire ITM, so I opted to roll it out and up to the $125 strike, earning an additional $0.48 net credit. This additional premium, together with the others I've collected thus far, continues to reduce the overall adjusted cost basis of the shares I now own.

 

Vertical Credit Spreads (CS) Strategy

I run a $1,000 virtual portfolio inside my Credit Spread (CS) Trading Journal to show traders new to options (and with initial modest capital) how to develop a small account using a conservative options approach employing discipline and patience.

On Thursday, with the stock price popping up, I closed the 09/17 Bull Put Credit Spread at $130/125 on MTCHkeeping 86% of the premium in 15 days.

The portfolio is presently up 42.5% since the Discord Chatroom's inception at the end of May 2021, with 12 wins and one minor loss.

 

Time Spreads (TS) Strategy

The Options Trading Club's fourth official technique is based on Time Spreads (TS), such as calendar or diagonal spreads. This approach is mostly used as a delta neutral edge against the other more directional strategies traded within the community.

Last week I opened two new short legs on the IWM double calendar campaign. I am planning to close the whole position (including the long legs) by September 10th.

 

If you have any questions, just send me an email at [email protected]

Take care and trade wisely!

-Gianmarco

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