S&P 500 heading for 1,200...

There has been a lot of selling the last couple weeks and it continues today. It looks like we may be headed back down to 1,200 on the broad market S&P 500 this week or next, but may see an interim relief rally back above 1,300 before reaching the lower numbers. Having closed Friday at 1,293, that's not much of a rally and I don't see it getting above 1,320 any time this week.

Expiration occurs next week, so if you're trading March credit spreads or iron condors this may be a bit of a "nail biter" on the put side of things.

Once you're within about 10 days of expiration, it can be difficult to roll a credit spread out within the same month. Gamma risk is pronounced when expiration is so close, which makes it a dangerous time to have a short spread under threat.

Review your trade plans, keep an eye on the market, and trade smart...

Christopher Smith
TheOptionClub.com