Market Overview:
The market remains stuck in a pretty tight range as rallies are sold and pullbacks are bought. The SPY has been trapped between 126.15-127.80 since the start of the new year. I'm still expecting the break of this range to be to the downside.
SPY Options Trading:
I sold to open weekly 128 calls on the pop this morning. I'm thinking the market stays capped below 128 for the rest of the week. I wouldn't be surprised if we see a false break to the upside. If that happens I'll probably try to sell more calls. I will most likely only look to sell weekly puts if we see a major selloff.
Key Levels in the SPY:
Resistance: 127.50, 127.75
Support: 127, 126.50, 126.15
Individual Stock Trading:
USO -
If we see a pop in USO after the oil inventory report tomorrow I will look to short it. I don't think the economy can support oil around $95/barrel yet. I'll look to short USO around 39.50 with a stop at 40.50 and a target of around 37.
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