BY ANDREW GIOVINAZZI
March 15, 2024
Yo Pit Crazies,
My Weekly Profits Cycles trade is only up a couple of bucks today but it was looking home run worthy when the SPDR S&P 500 Trust (Ticker: SPY) was down .75% today.
The next catalyst is likely next week when the FOMC opines on rates.
The PPI number “killed” the chance of a rate cut this cycle.
Just in time for the Ides of March and the famous assassination of Julius Caesar.
You know you are big time when folks still remember your death 2000 years later and your murder is a euphemism for treachery.
Kind of like what the USGOV is doing by “investing” $3 Trillion per year to stamp out inflation.
The madness of it all.
In the meantime we have the curious case of new higher lows in VIX.
Why do I watch this stuff?
Well I have a product called Weekly Profit Cycles that trades this stuff.
Thursday felt like the last day for the cycle that I would be able to sell my SPY puts for any real money.
The puts are still green but the acceleration happened fast and went away just as fast.
3 month chart in VIX with one day candles and fancy trend line
My Weekly Profits Cycles is a strategy based on SPY and VIX and uses time to my advantage.
It is what is known as a swing trade with a two week average hold time.
That means the trade I took Wednesday will play through the FOMC.
Oh Nelly!
Higher lows in VIX means there is no relief in sight for the current environment
The environment I mean is the reckless US GOV spending and accommodation by the Fed and raising rates on the other.
Think of VIX as the blood pressure for the market.
We just cannot get that blood pressure down no matter what stocks do and right now they go up.
Also note the forintraday spike in VIX that do not result in moves higher.
That is a very tight VIX range for the last 3 months and it looks like it is getting tighter!
The PPI number did not produce a real selloff after SPY going near straight up for days.
So SPY will resume the course and head to 520 by next week.
That is what it is.
My WPC trade will do just fine, even if SPY flies, but it will do better if I can close the SPY puts for money.
FOMC next Wednesday at 200 pm ET on VIX expiration of course.
To Your Trading Success,
-AG
Andrew Giovinazzi
30-Year Trading Pro
See what's hot at option pit
CAPITOL GAINS: SMR Aug16 7 call closed for a 150% gain
DELTA STRIKE: VLY Mar15 8 puts closed for a 88% gain
PFE May17 26 calls closed for a 66% win
OP MENTORING: SPY Mar22/19 510 put calendars and 520 calls for 6.4% gain
OPTION SHOPPER: ERX Mar28 65 calls closed for a 90% gain