Sanctions, sanctions, sanctions.
That is all we ever hear.
Yet the result has not really what NATO, the EU and other allies were hoping for …
It may be that the Russians just move to a Yuan-dominated world and replace all the West’s business interests in Russia with the Chinese.
Then Vladimir Putin camps in the Ukraine for the foreseeable future.
Meanwhile, we’re using the Russians to help negotiate with Iran? I can’t make this up.
Not a winning strategy in the long run.
And here’s a thought …
What if Putin decides to sanction the West?
That would be a mess.
The Oil Squeeze Is Not Over
When you’re trading, you want to make people pay for your uncertainty.
That is generally a rule that allowed me to thrive for 30 years in this business.
And I cannot help thinking I am the only person with that idea.
What if Putin cuts off the gas and oil to the EU? He has threatened to do it before.
It would be a mess. Oil would go to $150 or higher. Then what would the EU do?
What price would ExxonMobil (Ticker: XOM) be in that case? Maybe $110? At least that is what this customer thinks.
THE LESSON: In high vol environments, tails are undervalued. Keep that in mind if you are selling options too. Go way more OTM than you think you need.
The Rundown
Capitol Gains w/ Frank Gregory
Frank and I closed the Guggenheim Solar Trust ETF (Ticker: TAN) strangle for a 19% gain.
Option Shopper
Licia went shopping for Apple Inc (Ticker: AAPL) put spreads and rang the cash register for 60%+.
Power Income Trader
PIT closed some Ultrashort Lehman 20+ year Treasury bond ETF (Ticker: TBT) call spreads for a 66% gain.
Bill and I are working on an Xtrackers Harvest CSI 300 China (Ticker: ASHR) call spread and SPDR S&P 500 Trust (Ticker: SPY) put spread pair and I closed half the SPY put spreads for a 56% gain.
More good news is we have gains of 16%, 33%, 13%, 123%, 30%, 62% and 14% in the prior seven trades.
What’s our secret?
Trading Legion
I closed more of my Apple Inc (Ticker: AAPL) put flies for 100%+ profit per fly with part of the trade still on but holding out for a bit bigger gain on the put flies.
Nitro Trader:
Option Pit CEO Mark Sebastian uses a formerly private strategy for trades that can profit in either direction.
Mark went long Marathon Oil Corp (Ticker: MRO) call spreads versus Vaneck Russia ETF (Ticker: RSX) call spreads in a pair with MRO likely producing the dollars.
Pro Trading Room:
The Pro Room is Option Pit’s live access to Mark and myself during trading hours. Our Pro students post trade ideas with Mark and me during the entire trading session.
The Pro Room was closing more commodity oriented trades, as well as in the banks. For now, there is still weakness in all areas except for commodity plays:
Bto vxx mar11 26/28/30 cfly fills 0.26
Big Money Flow:
The BMF system works well in up or down markets. Mark …
– Closed all the Fluor Corp (Ticker: FLR) Apr14 22.5 Calls for a 153% gain
– Closed all the International Game Tech (Ticker: IGT) Mar18 26 Puts for a 94% gain.
– Closed all the Southwestern Energy Inc (Ticker: SWN) Mar25 5.5 Calls for a 76% gain
– Closed all the Pilgrims Pride Corp. (Ticker: PPC) Mar18 23 Puts for a 104% gain.
>> Go with the Flow yourself when you click here. <<
Volatility Edge & Volatility Trading Club:
The Option Pit VIX Light Is Green, as the market for VIX futures is in full backwardation. SPX is still going up and down with around 2%+ moves per day.
Mark closed VIX Edge call spreads for a 91% gain today in the Mar cycle.
To Your Trading Success,
AG