Posted by Martin December 20, 2022
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12.19.22 – MONDAY MARKET OUTLOOK

This market is completely news-driven, better say sentiment-driven, because as of now, there are no news but negative sentiment and fear about a recession which may not even come at all. After some initial positive upward movement in the morning, the market quickly turned negative and ended down 0.9%. And the future do not look any better. All our indicators are pointing down, so tomorrow, I expect a down day.

My trend forecast also indicates a gloomy day tomorrow. We probably open down with a gap and then go lower until about noon and have an end of the day rally:

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Of course, the forecast is just that, not a prediction. Other indicators must confirm it, and any news during the day may turn the market around, and no prediction can capture it. I do not have a crystal ball, I just use math. And so far, all indicators confirm the trend forecast. There is no news planned to come out that would shake the market (Housing data coming out and they should show a decline). That means I do not expect any catalyst that would change the forecasted trend. Expect further selling tomorrow.

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Posted by Martin December 18, 2022
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2022 Week 50 investing and trading report

Our trading and investing last week went smoothly again. We opened a few credit spreads, and all expired out of the money. But as the market crumbled last week, I closed a few high-flying stock positions like Amazon or Netflix. I did it to protect my net liq and am ready to buy back when the market improves. I do not mind buying at a higher price (it will still be way lower than what the stock price will be ten years from now). I sold to prevent margin calls. Suppose the market and these stocks continue lower; great. If not, my margin will improve, and I will buy back.

This is what I am talking about. Our NetLiq-cash-buying power ratio is a shit show, and I hate it. As you can see below, my cash balance increased significantly, yet my buying power and net-liq are dropping:

Our trading delivered $1,526.00 premiums last week, ending December 2022, at $2,844.00 (4.75%) options income. Our net-liq value decreased by -4.90% to $59,871.06 value. That is still a terrible result. I do not understand it anymore. I have defined risk option trades. These shall have no impact on the net-Liq. I have a few strangles. Yes, these can impact the net-liq, but I have only a few trades with long expiration, so they are not that sensitive. This is insane. Our overall account is now down -42.79% YTD.

Here is our investing and trading report:

Account Value:	$59,871.06	-$2,934.91	-4.90%
Options trading results
Options Premiums Received:	$1,526.00
01 January 2022 Options:	+$8,885.00	+8.36%
02 February 2022 Options:	+$10,009.00	+10.34%
03 March 2022 Options:	-$1,662.00	-1.47%
04 April 2022 Options:	+$1,047.00	+1.19%
05 May 2022 Options:	+$8,604.00	+11.32%
06 June 2022 Options:	+$9,691.00	+13.73%
07 July 2022 Options:	+$8,717.00	+11.39%
08 August 2022 Options:	+$7,987.00	+12.15%
09 September 2022 Options:	+$2,997.00	+5.76%
10 October 2022 Options:	+$3,979.00	+6.36%
11 November 2022 Options:	+$3,555.00	+5.26%
12 December 2022 Options:	+$2,844.00	+4.75%
Options Premiums YTD:	+$66,653.00	+111.33%
Dividend income results
Dividends Received:	$105.46
01 January 2022 Dividends:	$303.38
02 February 2022 Dividends:	$732.81
03 March 2022 Dividends:	$393.74
04 April 2022 Dividends:	$337.31
05 May 2022 Dividends:	$343.99
06 June 2022 Dividends:	$445.80
07 July 2022 Dividends:	$367.66
08 August 2022 Dividends:	$683.58
09 September 2022 Dividends:	$555.20
10 October 2022 Dividends:	$359.89
11 November 2022 Dividends:	$723.16
12 December 2022 Dividends:	$262.80
Dividends YTD:	$5,509.32
Portfolio Equity
Portfolio Equity:	$179,213.34	-$11,590.78	-6.07%
Portfolio metrics
Portfolio Yield:	5.64%
Portfolio Dividend Growth:	15.73%
Ann. Div Income & YOC in 10 yrs:	$139,447.10	69.41%
Ann. Div Income & YOC in 20 yrs:	$34,068,990.47	16,958.50%
Ann. Div Income & YOC in 25 yrs:	$5,825,331,514.93	2,899,671.88%
Ann. Div Income & YOC in 30 yrs:	$11,343,861,943,535.20	5,646,627,555.16%
Portfolio Alpha:	106.21%
Sharpe Ratio:	8.80	EXCELLENT
Portfolio Weighted Beta:	0.45
CAGR:	252.35%
AROC:	70.52%
TROC:	5.39%
Our 2022 Goal
2022 Dividend Goal:	$4,800.00	114.78%	COMPLETED
2022 Portfolio Value Goal:	$151,638.03	39.48%	In Progress
6-year Portfolio Value Goal:	$175,000.00	34.21%	In Progress
10-year Portfolio Value Goal:	$1,000,000.00	5.99%	In Progress

Dividend Investing and Trading Report

Last week we have received $105.46 in dividends bringing our December’s dividend income at $262.80.

Last week, we did not purchase any dividend stock.

Here is a chart of our account equity showing our accumulation goal and the value of all stocks in our account. It shows a nice upward-sloping chart as our equities grow. This is a result of our options trading and using premiums to buy dividend stocks:

And here you can see the dividend income those equities pay us every year:

Growth stocks Investing and Trading Report

Last week, we bought the following growth stocks and funds:

10 shares of SPXL @ $64.77

I temporarily sold AMZN and NFLX, but I will repurchase these shares as soon as my net-liq improves. I also sold out shares of Tesla. I do not plan on repurchasing these shares back.

Options Investing and Trading Report

Last week options trading delivered a gain of $1,526.00 making our December options income $2,844.00.

We were actively trading our SPX strategy that delivered +$2,560.00 gain.

Expected Future Dividend Income

We received $105.46 in dividends last week. Our portfolio currently yields 5.64% at $59,871.06 market value.

Our projected annual dividend income in 10 years is $139,447.10, but that projection is if we do absolutely nothing and let our positions grow without adding new positions or reinvesting the dividends.

We are also set to receive a $7,126.91 annual dividend income ($593.91 monthly income). We are 5.11% of our 10 year goal of $139,447.10 dividend income.

The chart above shows how our future dividend income is based on the future yield on cost and what dividend income we may expect. The expected dividend growth depends on what stocks we add to our portfolio and the stocks’ 3 years average dividend growth rate. It is interesting to see what passive income we may enjoy 10, 20, 25, or 30 years from now.

Market value of our holdings

Our non-adjusted stock holdings market value decreased from $190,804.12 to $179,213.34 last week.

In 2022 we plan on accumulating dividend stocks, monetizing these positions, HFEA strategy, and SPX trading. We plan to raise more of our holdings to 100 shares to sell covered calls. We continued rebalancing our options trades that released buying power significantly. That allowed us to start repurchasing shares of our interest.

We aim to accumulate 100 shares of dividend growth stocks we like and then start selling covered calls or strangles around those positions. We also planned on reinvesting all dividends back into those holdings.

Investing and trading ROI

Our options trading delivered a 4.75% monthly ROI in December 2022, totaling a 111.33% ROI YTD. We will exceed our 45% annual revenue goal in selling options against dividend stocks.

Our entire account is still down -42.79%.

Our options trading averaged $5,554.42 per month this year. If this trend continues, we will make $66,653.00 in trading options in 2022. As of today, we have made $66,653.00 trading options.

Old SPX trades repair

We traded our SPX put credit spread strategy, which you will be able to review in my next report. The SPX strategy has held well so far, and our signals kept us from opening new aggressive trades.

Investing and trading report in charts

Account Net-Liq

This drawdown of our account is highly discouraging. It’s like all previous gains were all wiped out. But this is just a temporary drawdown. Despite the losses, I am not selling any stock positions (except strategically sold Amazon and Netflix, which I will buy back). I will keep buying more shares if possible. I also have realized losses in my options trades. I am rolling those trades to keep them alive and adjusting them slowly, one by one, until they expire as winners. Then, this terribly-looking chart improves. It will be a long process to get back up, but I am determined.

Account Stocks holding

Last week, S&P 500 grew 33.17% since we opened our portfolio while our portfolio grew 10.22%. On YTD basis, the S&P 500 fell -31.59% and our portfolio -19.55%%. We are outperforming the market.

The numbers above apply to our stock holdings only.

Stock holdings Growth YTD

Our stock holdings outperform the market. Hopefully, this trend will stay, and we will constantly do better than S&P 500.

Our 10-year goal is to grow this account to $1,000,000.00 value in ten years. We are in year two, and we accomplished 5.99% of that goal.

Our 6-year goal is to reach $175,000 account value to be eligible for portfolio margin (PM), and today we accomplished 34.21% of that goal.

Our 2022 year goal is to grow this account to a $151,638.03, and today we accomplished 39.48% of this goal.

I am afraid our account is no longer on track to accomplish our 2022 year goal. We may achieve our dividend and options income goals, but our account balance (Net-Liq) will be down significantly. Of course, if the market finally rallies by the end of the year, it may all change, but if not, we will fail.

Investing and Trading Report – Options Monthly Income

Investing and Trading Report – Options Annual Income

Our dividend goal and future dividends

We planned to make $4,800.00 in dividend income in 2022. As of today, we received $5,509.32. This week, we completed our 2022 dividend goal. We also accumulated enough shares to start making $7,126.91 a year. Our monthly projected dividend income is $593.91, and our current monthly dividend income is $459.11.

I have a favor to ask. If you like this report, please, hit the like button, so I know that there is enough audience that like this content. Also, if there is something you want to know or you want me to change this report to a different format, let me know in the comments section.

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Posted by Martin December 18, 2022
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2022 SPX put credit spreads trading review – week 50

I didn’t have time to record my SPX trades last week, and when I reviewed them later, I thought last week’s trading would be a disaster. I rolled many trades for debit, and I couldn’t see any way that the last week’s trading would end up positive. I also opened two box trades to offset the costs of those rolls, but I was highly skeptical that it would help. When I finally plugged our SPX trades into my tracking spreadsheet, I was surprised to see that the trading was over $2,000 positive for the week. I was shocked. I didn’t have to open any of the box trades. All trades were overall positive despite debit rolls. So next week, I will use the collected credit to keep adjusting the trades to ensure they expire OTM.

Our trades delivered a $2,560.00 gain. But this gain is still tight up by open trades, and it may turn negative before the trades close. Our account weekly trading was up by 6.56% while SPX lost -2.09%.

Our SPX account is up +1055.22% since the beginning of this program, and we have $40,326 in unrealized gains.

Initial SPX trade set ups

I dedicated a $3,600 initial amount that will be used to trade SPX PCS strategy per week. Today, the account is up at $41,587.95. However, due to the recent bear market, many trades are still open, and the funds are tied to those open trades. The trades need to expire or be closed for a profit to release the funds.

Our SPX strategy is designed as directional options trading. We are selling credit put spreads to collect premiums, and hopefully, these spreads expire worthlessly, or we repurchase them for a small debit.

We use a set of indicators, trend prediction (primarily based on moving averages, volume profiles, and trend forecasting), and market sentiment that generates bullish signals. The trading is based on a “trend-following strategy.” We open the trade if we have a bullish signal and a bullish trend. If we do not have a signal, we stay away. We also trade credit call spreads when we have bearish signals. In a choppy market, we stay away from or trade very short expirations (usually 1 or 2 days or up to 7 days), but the trading is muted as we need a trending market.

Unfortunately, today, the market is headline sensitive and can gap in either direction to fail and reverse. It is not easy to trade and not get whipsawed. That’s why we are managing our older trades and not opening new ones until we see a clear market direction.

Here you can see all our trades:

Click on the picture above to see the entire list.

Last week trading

Overall, the strategy resulted in a +1055.22% gain last week.

Initial account value (since inception: 12/07/2021):	$3,600.00
Last week beginning value:	$39,027.95
Last week ending value:	$41,587.95 (+6.56%; total: +1055.22%)
The highest capital requirements to trade this strategy:	$19,995
Current capital at risk:	-$13,326
Unrealized Gain:	$40,326 (-302.61%)
Realized Gain:	-$2,853 (21.41%)
Total Gain:	$37,473 (-281.20%)
Win Ratio:	57%
Average Winner:	$317
Average Loser:	$459

As you can see, our account currently shows a realized loss of -$2,853.00, but we have $40,326 unrealized gains.

SPX PCS account value

SPX PCS account vs SPX index net liq

SPX PCS account vs SPX index

If you want to receive trade alerts whenever we open a new SPX put credit spread or a hedge trade, you can subscribe to our service:

SUBSCRIBE HERE

Note that if you wish to subscribe to multiple levels, you can only subscribe to one level and send us an email that you want to be added to other levels.

Also, if you like this report, hit the like button so I know there is enough audience wanting to see this type of report. If you have any questions or want to see anything else about my SPX trading, do not hesitate to contact me or comment in the comments section. Thank you!

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Posted by Martin December 17, 2022
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12.16.22 – FRIDAY MARKET OUTLOOK

The market continued its sell-off (and unfortunately, it will continue). The investors are now looking at the FED’s damage to the economy. If retail sales were a miss, you would think that it was good news. The FED may finally pivot. But it is no longer the narrative. It is now evidence that the FED is damaging the economy, and with their forecast of more damage to come, the recession is now more likely than it was just two weeks ago. Everybody, but FED, understands that the FED uses old, outdated, and lagging data to set their policy, and now they are likely overtightening the financial markets, and when they finally realize what damage they would have done, it would be too late to fix it. And despite cutting the rates, the economy will continue sliding lower into a recession. As much as I hate it, I just got rid of all growth stocks and high PE stocks and wait this storm out before buying back.

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Posted by Martin December 16, 2022
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12.15.22 – THURSDAY MARKET OUTLOOK

So we had a large failure and kneejerk reaction to yesterday’s Powell’s speech, supposedly to retail reports miss and who knows what else. At some point, the market was down 3%. What happened to JP Morgan’s prediction of a large rally if the CPI comes back lower? Now the market sits at the support, but I think this support will not hold. We may bounce tomorrow and recover all losses from today but on Monday we will see a renewed selling. So there are two options, one, this selling will continue tomorrow, and two, a bounce with Monday’s blood bath. In both scenarios, the market is heading lower.

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Posted by Martin December 15, 2022
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12.14.22 – WEDNESDAY MARKET OUTLOOK

Today, the FED announced increasing rates by 0.50% and the markets went initially up but then sold off hard on Powell’s remarks about potentially higher hikes next year. Investors were worried that this speed and tightness may destroy the labor market and sink the economy into recession. Though the VIX futures term is still positive, it may change soon. The market seems like it wanted to go higher and finally break above the 200-day MA and be done with the bear market but after Powell’s remarks, it no longer seems to be the case. It is rolling over again. The good news is, it is not a sharp reversal so far. We are still in a bear market and the rest of the week will probably be to the downside.

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Posted by Martin December 14, 2022
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12.13.22 – TUESDAY MARKET OUTLOOK

The market reacted with a huge jump at the opening after the CPI report indicated easing inflation. It jumped up 2.23%. But then it started a selloff, and the market declined the rest of the day. It erased all gains finishing up 0.73% only. Quite disappointing price action. But obvious one. We have had this pattern for almost a year now. The market reacted well to the good inflation news but failed to hold on to the gains. Today was no different. Tomorrow, Jay will tell us what we all already know, so let’s see how the market reacts to it. I kinda expect selling off as I think the rumors were priced in, and now we will see selling the news. Expect choppy trading tomorrow.

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Posted by Martin December 14, 2022
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Technical view: AES Corp. (AES)

AES is in stage #2. The stock continues trading near its all-time highs and starts forming a top. If the economy hits a recession, then bonds may perform better, and investors will most likely buy bonds rather than utilities. Thus, I am expecting (if that happens) that AES may drop. At the current price, the stock is overpriced and not investable. If it, however, drops, I will be a buyer.

Fundamentally, the stock is overvalued and not worth buying more shares (it is not in my buy zone yet). If it goes lower again at some point in the future, it can be a good entry point, but not today.

The stock is now HOLD

This post was published in our newsletter to our subscribers on Saturday, December 9th, 2022. If you want to learn more about our stock technical analysis subscribe to our weekly newsletter.

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Posted by Martin December 13, 2022
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12.12.22 – MONDAY MARKET OUTLOOK

Everything indicated the market going lower today – a continuation of Friday’s losses, but it didn’t happen. The market recovered all losses and some. In fact, according to all technical signals, the entire week should ve down except on Thursday and Friday, when we should see a recovery. It is not happening, but it still may happen. The market may be disturbed by a CPI report and FOMC meeting this week. A typical pattern was selling into the meeting and a rally afterward. It seems we see the opposite, buying the meeting and potentially selling the news. Tomorrow should be a down day, but I wouldn’t be surprised if we see an up day. So, expect choppy sideways trading until Wednesday afternoon.

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Posted by Martin December 11, 2022
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2022 Week 49 investing and trading report

Our trading and investing last week went smoothly. We opened a few credit spreads, and all expired out of the money. We didn’t buy shares last week as I am trying to keep cash handy in case we see a recession. That will be my goal for the next year to raise cash so I do not have margin call issues. Last week was OK, although our net-Liq dropped again. Three or four weeks ago, it went up almost 10%, and last week it dropped almost 8%… volatility is a bitch. And it will not get any better soon. We need all the idiots out there to calm down and take it rationally. But that is too much to ask.
Our NetLiq-cash-buying power ratio is a shit show again:

Our trading delivered $1,704.00 premiums last week, ending December 2022, at $1,318.00 (2.10%) options income. Our net-liq value decreased by -7.68% to $62,805.97 value. That is still a terrible result but improving. Our overall account is now down -39.98% YTD.

Here is our investing and trading report:

Account Value:	$62,805.97	-$4,820.76	-7.68%
Options trading results
Options Premiums Received:	+$1,704.00
01 January 2022 Options:	+$8,885.00	+8.36%
02 February 2022 Options:	+$10,009.00	+10.34%
03 March 2022 Options:	-$1,662.00	-1.47%
04 April 2022 Options:	+$1,047.00	+1.19%
05 May 2022 Options:	+$8,604.00	+11.32%
06 June 2022 Options:	+$9,691.00	+13.73%
07 July 2022 Options:	+$8,717.00	+11.39%
08 August 2022 Options:	+$7,987.00	+12.15%
09 September 2022 Options:	+$2,997.00	+5.76%
10 October 2022 Options:	+$3,979.00	+6.36%
11 November 2022 Options:	+$3,555.00	+5.26%
12 December 2022 Options:	$1,704.00	+2.10%
Options Premiums YTD:	+$65,127.00	+103.70%
Dividend income results
Dividends Received:	$42.16
01 January 2022 Dividends:	$303.38
02 February 2022 Dividends:	$732.81
03 March 2022 Dividends:	$393.74
04 April 2022 Dividends:	$337.31
05 May 2022 Dividends:	$343.99
06 June 2022 Dividends:	$445.80
07 July 2022 Dividends:	$367.66
08 August 2022 Dividends:	$683.58
09 September 2022 Dividends:	$555.20
10 October 2022 Dividends:	$359.89
11 November 2022 Dividends:	$723.16
12 December 2022 Dividends:	$157.34
Dividends YTD:	$5,403.86
Portfolio Equity
Portfolio Equity:	$190,804.12	-$12,270.74	-6.04%
Portfolio metrics
Portfolio Yield:	5.61%
Portfolio Dividend Growth:	15.73%
Ann. Div Income & YOC in 10 yrs:	$142,770.71	68.57%
Ann. Div Income & YOC in 20 yrs:	$34,189,248.17	16,420.76%
Ann. Div Income & YOC in 25 yrs:	$5,742,026,631.96	2,757,838.74%
Ann. Div Income & YOC in 30 yrs:	$10,929,143,931,534.80	5,249,160,005.16%
Portfolio Alpha:	100.77%
Sharpe Ratio:	7.19	EXCELLENT
Portfolio Weighted Beta:	0.21
CAGR:	259.29%
AROC:	65.29%
TROC:	10.10%
Our 2022 Goal
2022 Dividend Goal:	$4,800.00	112.58%	COMPLETED
2022 Portfolio Value Goal:	$151,638.03	41.42%	In Progress
6-year Portfolio Value Goal:	$175,000.00	35.89%	In Progress
10-year Portfolio Value Goal:	$1,000,000.00	6.28%	In Progress

Dividend Investing and Trading Report

Last week we have received $42.16 in dividends bringing our December’s dividend income at $157.34.

Last week, we did not purchase any dividend stock.

And here you can see the dividend income those equities pay us every year:

Growth stocks Investing and Trading Report

Last week, we purchased no growth stocks.

I started saving cash in the ICSH fund again to raise it to a 60% / 40% cash level.

Options Investing and Trading Report

Last week options trading delivered a gain of $1,704.00 making our December options income $1,318.00.

We were actively trading our SPX strategy that delivered +$910.00 gain.

Expected Future Dividend Income

We received $42.16 in dividends last week. Our portfolio currently yields 5.61% at $62,805.97 market value.

Our projected annual dividend income in 10 years is $142,770.71, but that projection is if we do absolutely nothing and let our positions grow without adding new positions or reinvesting the dividends.

We are also set to receive a $7,122.83 annual dividend income ($593.57 monthly income). We are 4.99% of our 10 year goal of $142,770.71 dividend income.

Market value of our holdings

Our non-adjusted stock holdings market value decreased from $203,074.86 to $190,804.12 last week.

Investing and trading ROI

Our options trading delivered a 2.10% monthly ROI in December 2022, totaling a 103.70% ROI YTD. We will exceed our 45% annual revenue goal in selling options against dividend stocks.

Our entire account is still down -39.98%.
Our options trading averaged $5,427.25 per month this year. If this trend continues, we will make $65,127.00 in trading options in 2022. As of today, we have made $$65,127.00 trading options.

Old SPX trades repair

We traded our SPX put credit spread strategy, which you will be able to review in my next report. The SPX strategy has held well so far, and our signals kept us from opening new aggressive trades.