MTM Options Trader Newsletter - The Sunk Cost Fallacy: Why You Are Holding on to Your Losers

[image]( [image] This Week in the Market Despite several big-name stocks losing ground after reporting their latest round of earnings, the market was able to push higher yet again last week. All three of the major indexes set all-time highs last week. As has been the case over the past couple of weeks, all three were well above their 50-day and 200-day moving averages. The market continues to shrug off any inflation talk as a smaller infrastructure bill looks like it may have a shot of being approved soon. Implied volatility levels ticked up a tad but remain relatively low. A continued bullish to non-bearish sentiment for the overall market seems justified for now, barring any unexpected downturns. Although many major companies have already announced with mixed results, plenty have yet to report. In addition, this week is full of economic announcements. The Federal Reserve is set for another meeting and despite the members most likely not moving rates, inflation talk continues to heat up. The Fed members’ language and thoughts about moving rates higher in the future may affect the performance of the market afterward. Not to be outdone by the Fed, the latest jobs report is expected before the open on Friday. Have a healthy, safe and prosperous week! Nov 1: Construction Spending Nov 3: Factory Orders Nov 3: FOMC Announcement Nov 4: Jobless Claims Nov 4: International Trade Deficit Nov 4: Productivity and Labor Nov 5: Unemployment Nov 5: Consumer Credit [Read Our Blog]( The Sunk Cost Fallacy: Why You Are Holding on to Your Losers “The stock is down 25%. But I didn’t lose money because I didn’t sell it yet.” That’s a quip from a conversation I had with a friend in a London pub a while back (her talking, not me). From there the conversation ultimately finished with an “I agree to disagree” ending. I told her she should ask her broker for that money she “didn’t lose” and see what happens. I still didn’t get through. But, you know, I can’t blame her for thinking this way— [Continue Reading ...]( MTM Watchlist Here are a few trade ideas we will most likely break down in group coaching class this week: GS – After a couple of successful call credit spreads on the stock with resistance around $415, we may consider more as well as an iron condor. FB – After a successful calendar spread around the 200-day moving average this past week, we may look at more if the stock continues to hang at the moving average. AAPL – After gapping lower on earnings, the stock raced higher to close out the week. A push above the $150 level could trigger some bull call spreads. [image] We're honored to have Dan's Book Trading Option Greeks listed as one of the [Top 6 Books to Become an Option Trader]( by Investopedia. [Buy Now on Amazon]( 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 calling (888) OPTIONS; 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 - 2021. 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