Index Spread: SPX Credit Spread

Here is an Index credit spread from me. Seeing as how the market has dumped the last couple of days, increasing in volatility, now is a good time to sell a spread. Actually in my opinion it is always a good time to sell a spread…LOL but here we can get better credits for out of the money options.

SPX has a resistance line around 1400 and is currently down trending, so I would look at a Bear Call credit spread for February, above the 1450 level for .50 or better. If the market decides to turn around, which I don’t believe the bleeding has stopped yet, it will have to break through resistance at 1400. If it does so then you will need to adjust the trade or close the trade.

The FEB 1455/1460 spread on SPX looks good right now and you may be able to squeeze .60 out of it, especially if the market bounces on Friday.

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