Yo Pit Crazies,
Let’s get right to it …
Below is a chart of the S&P 500 on a trip to Palookaville in 2022.
Implied volatility, meanwhile, is en route to the moon.
SPX six-month chart with one–day candles, plus 30-day (red) and 60-day (yellow) IV.
Yet we are conquering this sentiment with a specific type of trade idea.
See below how I booked a 31% profit in just one day.
SPX Is Low and IV Is High
This is not only a simple market condition. It is what I call an unstable condition because one of two things has to happen:
- SPX will bounce, pushing down IV
- SPX will keep dropping, pushing up IV
It’s just cause and effect.
In the OPMN Deep Dive session yesterday, we discussed just that and how to set up that trade.
When setting up market neutral strategies, I always want a paying side and a hedge side.
The paying side yesterday was the SPDR S&P 500 (Ticker: SPY) 375 put – which allowed me to book a 31% profit in a single day.
If you want to learn how to set up a trade like that see the video here.
Or join Mark’s session today at 11 a.m. ET
To Your Trading Success,
AG