With the futures up nearly 1% before the market opens, it looks likely that we will rally up a bit this morning. We talked late last week of a short term rally. The market is due for a rally. It has been down for 10 days in a row. The rally should only be a short term rally. Watch the previous support areas as targets for the rally. I'm watching the 1040 area on the S&P 500. This has been such a key level over the last few months. I don't expect the market to rally back above this level. If it does, then you might want to close out your put option trades and take your profits until it can get back below the 1040 level. Gold looks weak this morning and should start to roll over and go down. If the GLD gets back above $120, you would probably want to stop yourself out and wait for it to get back below that level. Everything still looks great if you are bearish like me. If you have July options, you need to make sure you set up a plan to exit those trades. Any rally could affect the profitability of those options. As long as we don't move above 1040 on the S&P 500, it should be a great day to enter into new put option positions. Many stocks look to be in the "C" wave of a shorter term bearish ABC pattern. With the volatility dropping today, you could get into some nice put option positions at a pretty good price. If you can, try to wait until the end of the day to make sure we haven't moved above that key resistance level (1040).
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I'm new in the class so pardon a probably simple question, but since August options are 46 days out & October options are 102 days out, this doesn't fall within the guidelines for days left to trade. I know this is judgment, not a checklist, but what else would I look at to help me determine which month's options to look at?
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