For a second on Tuesday, it looked like the S&P 500 was going to make a serious run higher…
After all, almost all the scary news that could come out, was out.
CPI came in light, despite a nice jobs report …
Earnings season has been pretty okay so far. (Notably, AAPL has had a major bounce post-earnings.)
But then the SPX came to a screeching halt.
What stopped it…
You tell me:
That right, the S&P 500 ran all the way up to the 200-day moving average and then failed.
To make matters worse, the S&P fell despite what appears to be a mostly benign FOMC minutes on Wednesday.
So, folks, this is the moment …
The S&P 500 is either going to make a serious run at 4500…
Or 4000 is coming up fast.
The key is what happens the rest of this week.
If the S&P 500 can break the 200 dma and stay above it by Friday, then we could see the market run hot all the way into Non-Farm Payrolls on September 2.
That would be two weeks of FOMO … and 2 weeks of short covering.
That will push us to 4500.
If not, we are going to 4000 again.
So what is a trader to do?
Buy a straddle!
The SPX August 19th PM straddle went out $47.
We have moved about that much or more every single day this week.
And about that much every day last week.
If you are willing to manage the movement intra day …
There is a ton of money to be made owning premium through Friday.
Questions about that? Shoot me an email or drop a comment below.
Your Only Option,
Mark Sebastian