BpowersCLT

BpowersCLT

Real estate has been booming along with bonds recently because of the widely expected cut in the Fed funds rate in July. I think that this move has already priced in the rate cut, and so if rates are cut, price will move very little. The risk is that rates are not cut! Check out the AUG-23 weeklies for attractive pricing.

BpowersCLT

Right now one of the few places to find high IV across the market is in precious metals - gold, silver, and their corresponding miners. I'm still currently short IV and technically Delta short in $GDXJ, but I think IV will join the market overall and will fall in this sector over the coming weeks. The AUG-23 14 Short Straddle on $SLV has breakevens above recent...

BpowersCLT

If you follow my ideas you know that I like to be neutral more often than not. I originally was looking at a Calendar spread for $EEM but decided that an Iron Butterfly would be the better trade. It has wider breakevens to cover the majority of the recent range, as opposed to the Calendar, which would require an increase in IV to expand its range. Typically, IV...

BpowersCLT

$MU just had earnings and traded way up again today. Right now I'm looking at this "congestion zone" that the stock had back in February - March of this year. I think that if $MU keeps going that it might stall out here in this zone, and that might be a good opportunity to buy a Calendar spread on $MU - a trade that takes advantage of increasing IV. I have had...

BpowersCLT

$SMH is currently short-term overbought as the ETF has risen from about 98 to above 116 before shedding gains. Because of it's short-term overbought status, it might look like a good short opportunity. However, I think it $SMH might lurk between 110 and 116 as the overall market digests Trade War news and the now questionable expected rate-CUT from the Fed in...

BpowersCLT

Implied volatility is very high in $DELL, and earnings are not until after August expiration. Right now, the 45/60 strangle for August has attractive pricing, high profit probability, and relatively small margin requirement. $Dell would need to rise by 16.4% or fall by 13.7% from current levels to be ITM.

BpowersCLT

$MPC is bucking the oil-down trend and has broken out above prior resistance (cyan line). Now, $MPC may run up into earnings on 7/25 to about 60. A standard vertical call spread is a great way to play that chance without taking much risk at all.

BpowersCLT

Instead of selling a short strangle, it's better to buy some OTM contracts at next to nothing to make the trade efficient in terms of buying power. The breakeven points on the trade aren't GREAT, but, the trade is pretty low risk. If it works, great and if not, hey, we'll get 'em next time.

BpowersCLT

While implied volatility percentile (IVP) is modest at around 41 for $COTY, implied volatility itself is around 35%, meaning that option premiums are still attractive for selling. Yellow lines represent breakeven points for the AUG19 13 short straddle, which are beyond the current 30 day expected range.

BpowersCLT

As I stated in the related and previous idea, IV is dropping across the market unless the stock has upcoming earnings or the stock is related to gold. For more on my analysis behind trades like this, check out this YouTube video: >>youtube.com/watch?v=snPDcCSdyLY<<

BpowersCLT

A lot of stocks that have high implied volatility are coming up on earnings. Elsewhere, unless it's gold related, IV is dropping in the market. I like to keep a good balance between high vol trades and low vol trades. So I see an opportunity to sell an Iron Butterfly (technically a very tight Iron Condor) in $CSCO.

BpowersCLT

Implied Volatility remains high in gold and gold miners stocks. The opportunity to sell option premium is still here with great risk/reward. Check out the breakeven range on the AUG-2 29/34.5 strangle. BIG RANGE! And as IV inevitably comes down, that range becomes less and less likely to be broken.

BpowersCLT

I think implied volatility and price will remain stable over the next few weeks as we await the Fed's decision on rates at the July meeting. Personally, I think that rates remain unchanged, but the market thinks a cut will be announced. Google "countdown to FOMC CME" and you'll see what I mean. Even if the Fed DOES cut rates, that is being implied by the...

BpowersCLT

If you follow me you know I like short volatility and delta neutral trades. This one is no different. IV in $MYL has been dropping over recent weeks and I believe will continue to do so. Currently, options on the weeklies are not ideal because of liquidity, so I think the JUL19 standard expiration would be better. I opened AUG-2 15.5/19.5 and am currently getting...

BpowersCLT

$EWZ has pretty good pricing in its OTM options right now, and the August weeklies in particular. The 38/45.5 Strangle priced around 1.20 looks pretty decent right now and covers about a 1 standard deviation move. Worth a shot.

BpowersCLT

$STNE looks like it's trying to break-out above recent resistance just under 29 (purple line). Should the stock fail again, I'd say the chances that it sits between 24 and 30 over the next couple of weeks is pretty good. So, if there's a lack of momentum to carry the stock higher, the JUL19 27.5/29 short Strangle is attractively priced and would be a good...

BpowersCLT

Implied volatility is falling in this stock as it nears the more or less average price of around 86 per share over the previous 6 months. I think the price might stay in that range after it's recent moves over April and May. JUL19 75/80/90/95 Iron Condor is attractively priced, and is a better play than just the short Strangle or Straddle given the margin requirements.

BpowersCLT

$S options are priced for a great short strangle opportunity. Black lines represent the break-even points for the JUL19 6/7 short strangle at 4.68 and 8.32, accounting for about a 27% move in stock price by July expiration. With the T-Mobile merger now in an expected wait period due to State lawsuits, its possible that the deal either 1) doesn't happen at all, or...