2/16 Almanac

Monday, Feb. 15, is a markets holiday. Happy President's Day!

Tuesday, Feb. 16, is 3 days before February options expire, 31 the March and 59 the April.

Blue chip stocks (SPY) closed the latest regular session at $108.04, down 0.08% from the prior close.

In total, 3.5 billion shares were traded on the three major U.S. stock exchanges. That's about 9.4% more than the prior day.

Mediawatch: The Greek narrative has been swapped out for a new Chinese narrative. China announced further limits on bank lending, and so stocks fell. (If you can consider 8/100th of one percent to be a fall. I mean, it looks more like a nervous tic.) AP writes it like this.

On the jump, rules, econ reports, portfolio, tasks ahead and a good book...

My rules allow trades today in March iron condors and covered calls, along with butterfly, calendar and vertical spreads. I allow myself to trade unhedged call and put option purchases that expire in April or later. These economic reports will be released: The Treasury Department at 9 a.m. Eastern will release a report tracking flows of foreign investment capital into and out of the United States. This is a measure of international confidence in the U.S. economy. Since we're the world's largest debtor nation, we better hope they confidence, lest they pack up their chips and go home. The National Association of Home Builders at 1 p.m. reports issues it's housing market index report. The state of the housing markets (it's all local) is a hugely important indicator for the future course of economy. If people lack the chops to buy a house, then you can bet they'll be nervous about all spending. Another way of trying to answer the question, "Can we spend our way back to prosperity?"

"That humblest of quality-control devices, the checklist, is the key to taming a high-tech economy." --Publishers Weekly. And if you don't think traders make mistakes...!

My portfolio consists of . . .

February expiry:

• CVS, iron condor, p28/-p31/-c34/c36
• ERTS, iron condor, p15/-p16/-c18/c19
• MCO, covered call,  s/-c30
  
• PALM, covered call, s/-c13

March expiry:

• CSCO, iron condor, p22/-p23/-c25/c26

My tasks next week are mainly dictated by the calendar.

• Close out the February option positions. This must be done by Wednesday at the latest. The two iron condors, CVS and ERTS, are in profitable territory. Do I close and take a chance on a sudden move, or do I take the money and run? The covered calls, MCO and PALM, won't be exercised, so I need not do anything.
• With 31 days left for March, time to open some quick covered calls. I'll be running a scan over the weekend and will post it here. I'm partial to stocks that pay dividends, so if I'm left with a zombie stock, that fell well below the strike price of the initial covered call, I can still get a bit of cash for holding it.
• My live swing trade prospect is XHB, and I'll be watching that on Tuesday for a swing top.

Enjoy the long weekend!

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Topics: S&P 500, SPDR, Spiders, Cisco Systems networking, CVS Caremark, pharmacies, drugs, Electronic Arts games, Moodys bond rating, Palm smartphone Pixi Pri, home builders.