I know I said I wouldn’t, nor did I want to monitor anything over Christmas, but the Founders Group is back to a 40% position in each of SPY, and DIA January ATM calls for a total of 80%. As Chairman Powell spoke, we entered the calls when the SPY was 463.73, and the IWM was 356.25, respectively. As I had suspected, the Fed was a bit more aggressive than anticipated, so the market is happy for now. Welcome, Santa Claus!
Since this is a swing position, you can enter at the close today or even on a small pullback tomorrow. The market is racing on short-covering at the moment, so it makes sense to wait for the short-covering to calm down. You may be able to enter in the morning.
I am hoping we can hold these positions for a few weeks. With the Fed meeting out of the way, there is not much negativity between now and year-end.
A.F. Thornton