MTM Options Trader Newsletter - How Earnings Affect Implied Volatility

[image](=) [image] This Week in the Market Stocks did their best to stay afloat last week, but worries about inflation not improving from recent economic reports pushed the indexes lower with two big drops Wednesday and Friday. The S&P 500 is now flirting with potential support, which is its 50-day moving average. That area may prove to be a critical level for the index heading into this week. The non-bearish bias on the market we have been observing over the past several months seems to have been challenged recently. A non-bullish bias might be warranted with a failure to hold that moving average going forward. Implied volatility levels and option prices have increased correlating with the drop in the market. This week is loaded with economic reports, including the latest retail sales figure for March and a couple of housing reports. Those numbers may have a direct impact on inflation thoughts as well. In addition, the latest round of quarterly earnings is starting to accelerate and will continue to do so for the next couple of weeks. Many of the big-name stocks will be announcing the following week. Remember to schedule some days off from trading. Everyone needs a break. Have a safe, healthy and prosperous week! Apr 15: Retail Sales Apr 15: Business Inventories Apr 16: Housing Starts Apr 16: Industrial Production Apr 17: Beige Book Apr 18: Jobless Claims Apr 18: Existing Home Sales Apr 18: Leading Economic Indicators [Read Our Blog]( How Earnings Affect Implied Volatility The market continues to be very volatile. It seems anything a Federal Reserve member comments on moves the market. Inflation numbers have caused big moves as well. Implied volatility levels have risen from the previously low levels of a few weeks ago. With a new round of quarterly earnings about to kick off, let’s consider how these announcements might affect IV levels. What Is Implied Volatility? The definition of implied volatility I like best is that it is the estimated volatility of the under... [Continue Reading …]( MTM Watchlist Here are a few trade ideas we will most likely look at this week in group coaching class: SPY – This ETF remains a very profitable option, no pun intended. This week we will model out more vertical (debit and credit) spreads, including more 0-DTE trades. FDX – After gapping higher following its earnings announcement, the stock continues to drift lower. Potential bear put and directional put calendars will be explored. VLO – Energy looks like it might be ready to move higher again after a recent pullback. Potential bull call spread will be considered. [image](=) The strategies in this newsletter are for educational and informative purposes only. All information disclosed in this newsletter should not be considered complete in its entirety. Market Taker Mentoring, Inc. will not be held responsible for changes, oversights, errors or omissions. Dates, prices, news and other information may not be accurate. Please verify all information before trading. You alone are responsible for your own investment decisions. Options involve risk and are not suitable for all investors. Before trading options, please read Characteristics and Risks of Standardized Option (ODD), which can be obtained from your broker; by emailing investorservices@theocc .com; or from The Options Clearing Corp., 125 S. Franklin St., Suite 1200, Chicago, IL 60606. No statement in this newsletter is intended to be a recommendation or solicitation to buy or sell any security or to provide investment or trading advice. Traders and investors considering options should consult a professional tax advisor as to how taxes may affect the outcome of contemplated options transactions. Copyright Market Taker Mentoring, Inc. 2008 - 2024. All rights reserved. Reproducing or redistributing this content is a violation of federal law. [image] If you do not wish to be contacted via email, you can unsubscribe using this link: [Unsubscribe]( Unsubscribing from email notifications DOES NOT cancel your class, subscription or recurring payments. We recommend that current students do not unsubscribe from email notifications. If you unsubscribe from email notifications, you will not be notified on how to access the classes or subscriptions in which you are enrolled. Market Taker Mentoring, Inc. PO Box 117 Frankfort, Illinois 60423 United States