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OK, yeah, I’ve mentioned this victory before, but it’s so much better now that I’ve just got to give it its due. I nailed Moderna just about to the millisecond with this post. It has plunged over $100 per share in a matter of days. All hail the gap! This chart is a little out of date, taken in the middle of the trading day on Monday……
The CBOE Volatility Index (VIX), otherwise known as the investors’ fear gauge, is still hovering around 30, a number that offers some intriguing opportunities to sell premium using a variety of different options strategies.
Credit spreads are great strategies for this market environment, particularly for those who prefer risk-defined options strategies. Over the past month I’ve posted three trades using simple credit spreads, bear call spreads to be exact, that have fortunately led to some decent profits.
As I’ve discussed on a few occasions, with a bear call spread I have a decent margin of error just in case the stock, or ETF in today’s example, pushes higher. If it pushes lower, particularly if it is immediate, I should be able to lock in a quick gain.
(more…)This is a subtle change, but I think it’s worth mentioning. I’ve never been too happy with the left trendline on IYR (the real estate ETF) so I’ve adjusted it and am much more satisfied with the result. It is far more accurate as an analog, plus it just so happens that now that angles of the lines are just about identical (62 degrees and 69 degrees, respectively). The bottom line is that I think the long-term direction of IYR is going to be substantially lower.
I noticed something quite interesting. You see, I am surrounded by screens, each of them representing a different important market. I noticed on the NQ that it hit a couple of red lines and then started falling. I was curious what those red lines might be.
As much of a kick as it is to see the market get swamped by selling for a few days, it is only natural (particularly given the corrupted construct of this market) that there be some strong buying at some point, such as, oh, right now. Indeed, as I am thumbing through some of the younger charts out there (those that have been public only a year or two and, in recent weeks, have been particularly ravaged), they are the ones hammering out what look like solid short-term bottoms.
All the same, as I look through the index charts, the kinds of levels the indexes are approaching making all the sense in the world with respect to where gaps should be closed or resistance should be met. Even in the context of an overall market swoon, the market action today is abundantly acceptable.
