Today the RUT rallied rather strongly, complete the opposite from yesterday. Yesterday, I wrote that the upside risk was low. Boy was I wrong. The strong rally nearly erased all my gain since I placed the trade on 7/22 (nearly two weeks ago). The silver lining is that the volume wasn’t above average.
Today was Fed day and the FOMC decided to keep rates steady at 2.00%. The RUT and general market had been strong leading up to the announcement at 2:15pm. The indexes rallied on the continued falling energy prices due to slowing global economic growth.
Lets see if the RUT comes back down to below 710. Given how volatile the market has been lately, I wouldn’t be surprised to see the RUT fall more than 1%. As long as the RUT see-saws back and forth and doesn’t go up or down continuously, then I should be okay. Next week is expiration week.
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