MTM Options Trader Newsletter - Support and Resistance Are Your Edge

[image]() [image] This Week in the Market Stocks dropped dramatically on Friday as comments from Federal Reserve President Powell left buyers nowhere to be seen. His comments put the market in a negative mood giving the impression that the Fed will keep raising rates to a restrictive level and will not change to a rate-cut cycle anytime soon. Powell also said some households and businesses might feel some pain before it is over. The three major indexes dropped well below their 200-day moving averages after flirting with them last week but stayed above their respective 50-day moving averages. Implied volatility levels and option prices that had dropped so much over the past several weeks saw a huge spike higher on Friday. This week it will be interesting to see whether the market can find some footing or will continue to drop toward the 50-day moving average. It could be a very busy week ahead as several Fed presidents are scheduled to talk this week. The probability of a 75-basis-point rate hike in September was about 60% at the time of this writing. That may change after this week too. In addition, several economic reports are due out this week, including the much-anticipated August jobs report on Friday before the market opens. Earnings remain slow for now. Remember being flat is a position. Have a healthy, safe and productive week! Aug 30: Consumer Confidence Aug 30: JOLTS Sep 1: Jobless Claims Sep 1: Productivity and Labor Sep 1: Construction Spending Sep 2: Unemployment Sep 2: Factory Orders [Read Our Blog](=) Support and Resistance Are Your Edge Over the past several months, this market has been tough to navigate as a swing trader, in my opinion and based on discussions with other traders. But despite so-called difficult market conditions, traders can always look for an edge, and that edge can be support and resistance. Better Chance to Hold As I say frequently in MTM’s daily group coaching class, [Continue Reading ...]( MTM Watchlist Here are a few trade ideas we may look at in group coaching class this coming week: SPY – After a huge drop on Friday, the market may be looking to move higher again. With IV levels elevated, bull put spreads around potential support levels and long calendars will be considered. TSLA – With its 200-day moving average just above where it is trading, the stock may have a tough time moving over that level, especially if the market stays soft. Potential bear call spreads will be explored. FCX – The stock looked like it was breaking out until Friday hit. Potential bull call spreads and long calls will be examined with a move higher early in the week. [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 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 - 2022. 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