MTM Options Trader Newsletter - Don’t Forget About Long Calls and Puts

This Week in the Market It was another dose of big-name companies announcing earnings last week. The major indexes chopped and slopped around, producing a big rally Thursday and a small one Friday that pushed the S&P 500 into positive territory. As we head into this week, a non-bearish bias on the overall market continues to make sense. Most major support levels have held when tested, which is a strong bullish sign for stocks. Implied volatility levels and IV skews ticked up and will for sure be evident this coming week. Why will that be the case, you ask? It's time for another Federal Reserve announcement this Wednesday afternoon. The current consensus is that members will raise the borrowing rate 25 basis points. How the market reacts that afternoon and going forward is anyone's guess. In addition, there are several other economic reports due this week, including the April jobs report. Quarterly earnings will keep rolling in as well since the bulk of companies have not yet reported. Have a healthy, safe and profitable week!

May 1: Construction Spending May 2: JOLTS May 2: Factory Orders May 3: FOMC May 4: Jobless Claims May 4: Trade Deficit May 5: Unemployment May 5: Consumer Credit Read Our Blog

Don't Forget About Long Calls and Puts One thing that annoys me a bit is when option traders refuse to consider buying a call or put, no matter what. Granted, I only use long calls and puts in certain situations, but I will still buy them. Here is a brief reminder to all option traders who have abandoned buying calls: Please don't forget to consider them as an option, so to speak. Got Me Started The first thing I learned as a brand-new option trader was a long call. I viewed it as a great strategy when I expected to profit from a move higher in the stock for significantly less money than buying shares. Continue Reading ... MTM Watchlist Here are a few trade ideas we will most likely look at in group coaching class this week: SPY – The double calendars have not been as tempting lately with IV skews between the short and long expirations narrower. That will change this week with the FOMC on Wednesday. META – After gapping much higher last week, the stock held its own and moved higher still. Potential bull puts and cash-secured puts will be explored. ZS – The stock continues to slide lower trading at its 52-week low on Friday. Potential bear call and bear puts spreads will be modeled out.

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 - 2023. All rights reserved. Reproducing or redistributing this content is a violation of federal law.

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