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Weekly results May 25, 2018

S&P 500  2,721.33 -6.43 (-0.24%)  Dow 30  24,753.09 -58.67 (-0.24%)  Nasdaq  7,433.85 +9.42 (+0.13%)
 

Market fearThis post actually contains results from the last two weeks as my internet modem refused to work last week so I was dependent on my phone only.

Last week trading was good for neutral trading. Opening Iron Condors paid the most as the markets got pretty much nowhere. Last week we rolled a few trades which needed attention and opened a few new trades which mostly ended successfully.

We also collected nice dividends last week and added a few new dividend aristocrats to our account. I consider the last two weeks successful.

If you wish to see details and our results on Net-Liq, options income and new dividend stocks we added to our portfolio, please continue reading.

 

 

As I mentioned, last week, was good for neutral trades such as Iron Condors but simple put or call spreads worked well too. We took a few great trades last week which mostly ended for a full profit either expired worthless or were closed for a small debit (bought back for 0.05 debit).

 

 

The trade above was a simple and fast Iron Condor which was a day long trade, delivered 0.40 or $40 credit and expired worthless. Nice profit for a day.
 

Another trade was an Iron Butterfly:
 

 

This trade was veru juicy bringing in a nice premium. The premise was that the market will not move and stay in the range of 2715 or nearby. It was like that for the whole day and it seemed it would work great. This was a day long trade too! But then after FOMC meeting the market suddenly rallied and our call side got completely breached. Full loss! Usually we see a pull back after an intraday rally but there are rare occasions when this doesn’t happen. Well this was one.

So we rolled our trade for the next week. We rolled our call side into in the money puts and sold new call spread against it to make the entire trade cash positive. And, as you may guessed it, the very next day the market sold off and dropped below the initial 2715 level. Now we have in the money puts to deal with in about the next 10 days.
 

Our next trade was an Iron Condor against Boeing (BA) as I still expect this market to be neutral (until the trend changes):

 

 

As I said many times, I use 50% of our options trading profits to purchase a high quality dividend stocks (aristocrats).

Last week was great and we collected great premiums and made really nice income of $3,733.14 dollars. We didn’t use all 50% of this amount yet but we made a small purchase last week and purchased Procter & Gamble as the stock showed the best chart out of the other candidates. Other candidates on our undervalued list were quite extended and reversing their recent rally. PG on the other hand showed bottoming pattern. Of course, I may be wrong, but with information available today it looked like a good move.
 

 

Overall, last week for, some reason, I didn’t feel compelled to make any purchases so I still hold plenty of cash on hand and see if I will be purchasing more shares later on or sit on my hands.

 

The markets spend majority of time in neutral patterns. Up to 70% of the market moves is in consolidations. And evidently we are in one these days.

On a short term view, we are clearly range bound between 2700 – 2740 marks and the market is quite lazy to make a significant move. It can be a good sign though. We may be consolidating before the next leg up:

 
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Many are in a bearish expectations but this sideways move actually can be a forming bull flag on a longer time frame. If that is correct and this really is a bullflag which will fire, we may see another leg up soon:

 
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My view is that this market is forming another base for a new uptrend. Of course, this is not guaranteed and anything may happen but if we review long term frame we will find another “historical evidence” that odds are in favor of a future long term uptrend. Of course, a bumpy volatile road up is still very possible.

I recommend you to see the following video explaining the long term view comparing previous price actions of the 2007 – 2008 market behavior and 2017 – 2018 pattern:

 

 

All time frames point towards possible uptrend. However, do not take it as a prediction. It may not happen and the market may develop differently. If it develops as expected, we or on the way higher.

 

 · Weekly Results May 25, 2018

 

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Last week we made $3,733.14 dollars total across all accounts.

Here is a list of all trades closed last week:

 

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You can follow all trades here.
 

 

 · Dividend stocks to buy

 

Out of our watch list of 37 dividend stocks the following ones are a good buy at today’s prices (05/25/2018):

 
S&P500
 


Disclaimer: The list above is based on calculated fair value and 52wk high offset valuation. The values are subjective to our calculations and opinion and may differ from your own. If you decide to trade or buy these stocks, do so on your own risk and do your own homework. The list is not our recommendation to you.

 





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