The Trade From The Road

I pulled over on the side of the road yesterday in the middle of nowhere in southern Illinois to get out of the SPY 141 puts at just over 1405 on the S&P.  I was looking for the 1400 area and 1405 felt close enough when I realized I just might lose wireless coverage at any moment.  This morning it looks like I'll get my chance at 1400 or below in the hotel room here in Memphis.  Trading from the road is all about being fortunate for what you get and acting on it without hesitation -- a great practice, and a great metaphor for life too.

I'll be looking to add some SPY 139 calls near the open looking for new highs above 1422.38.  The decline is looking like it will end up being a 3-wave correction.  If I'm right, new highs will follow. 1386.87 is the hard stop if I'm wrong.

This morning the market's mood seems gloomy in the face of a triple threat from the Fed, the ECB, and China.  The Fed is sounding more hawkish and everyone is wondering where did the QE go.  The ECB is sounding depressed, and Draghi is openly warning banks to strengthen their balance sheets.  China is hinting that the party's over.  This may turn out to be a double entendre as more and more Chinese question Communism.

I don't trade on news, but it will be interesting to see if the mood is finally changing.  The market will let us know very clearly.  Until such time, it pays to speculate with cheap options due to complacent volatility levels.