New Resistance??

Well Traders, the $NDX tried to make a nice rally today reaching $20 points higher after a lower open, then fell off in late afternoon trading to finish up only $8.75 for the day. What does that mean for my trade? Well, if you look at the chart above (remember to click on it once or twice to enlarge it, then use the "back" key to return to the blog), you'll see that the index tried to break back into the Ascending Channel, was able to do it momentarily, but was unable to remain there for the day. This may mean that the previous lower support for the Asecending Channel now becomes resistance, which would be wonderful for my December Iron Condor.

If you look on the chart, if the lower support of the AC does indeed remain as resistance, then it will effectively block the $NDX from breaking into my Bear Call, and my trade will be profitable next Friday morning. According to my projections, the AC will keep the $NDX to no more than about $1,815-$1,820, which is all I need since my Bear Call is an $1,850/$1,875 spread.

As it is already, the value on the $1,850 Short has diminished from $7.20 to only $0.85, meaning on Monday, time value will really begin burning off fast unless there is a HUGE run-up (which is always a possibility).

As for next week, it will be time to start planning the January Iron Condor, or maybe just a one-sided spread depending on what the chart and projections are telling me. The January IC will be executed on Friday as part of my shortened time strategy. I am also doing this because it gets VERY confusing looking at two Iron Condor trades on CyberTrader at the same time. I'll play more contracts for less time.

Have a great weekend and Happy Trading!