Once in a while the market throws a curve ball, and this time it’s the Coronavirus that is making it twitchy.
The strong action from China reveals how seriously they’re taking it, and given their reputation for transparency (or lack of) it cannot be taken for granted that the numbers they’re reporting are reliable.
What that left us with was a Wednesday and Thursday that seemed to reflect market nervousness but with an optimistic close, and then a Friday where the nervousness returned and we closed at the low.
That meant some otherwise sound positions will have been adversely affected and many pending breakouts simply won’t have broken out.
On Thursday we had a big session that was particularly well received. The session including some important learning points as well as a thorough market review.
So, given that the Coronavirus is making things temporarily unpredictable (think straddles, options traders!), and given that I have painful sore throat (unconnected I hope!) I’m going to post the link to that session here as it’s best to observe for the moment.
We’ve had a good run, and we’re currently in earnings season, so given the current circumstances our focus can start to shift to post-earnings, and to good-value straddles according to those particular rules.
Straddles are where you expect a stock to move one way or another but have no particular directional bias, and provided it does move adequately you’ll make money. The strategy involves buying a call and put together, but it must be done in a certain way that balances risk against opportunity. It’s a fun strategy to be used in its correct context, and I’ll talk more about it in a webinar soon.
Here’s the link to today’s market review, which will cover recent setups and new setups that, given Friday’s action, are likely now ineligible.