Plan for 1-8-15

Essentially, we could rally quite a bit tomorrow if US employment data and Chinese economic data, primarily, are good. The price of oil will reflect the economic data, and US stock futures will tell us where things stand right before the market open. If they are up a lot we are going to rally hard.The E-mini S&P was around 2055 on the 7th at its peak. So if we're up significantly from that number tomorrow morning we know rally is in the air.

If rally, then we immediately on market open buy $1000 or so more of SPX calls expiring on Friday. We wait intraday for what looks like a likely peak (during morning unless we are really rallying) and then we sell SPX calls right at or above this peak. Or slightly below as the situation is. This hedges our bets because the market most likely won't close at the peak of the day...maybe takes away a little upside potential but more likely increases profits by decreasing the amount of capital committed to the trade, therefore also decreasing risk. I like that setup.

If there is rally then we're done here. Our previous trade will likely expire as a winner. The only thing we need to watch for is 10:30 (or 7:30 my time) Lacker will speak at the FED. So watch rxn. If things start going south intraday, just take the profits (hopefully) and run.

If there is not a strong rally we may buy some calls and do this thing but with $500 or so instead of $1000.

If a rally is doubtful we will NOT buy calls. And we may try to get out of our previous trade.

If market really tanks we will immediately sell the call spread while buying puts. And then we will trade just like we would the rally scenario but with puts. And if this goes south intraday we will immediately buy it back.

I am very much hoping that we have a continued rally or trade flat because my real money trading future depends on not achieving a large loss, and on the contrary achieving profit. Otherwise I must content myself with fake money until I have proven that I can trade effectively. And the rally scenario would be the easiest trading. It is also the most likely in my opinion.