MTM Options Trader Newsletter - Basic Options Strategy (and More)

[image]() [image] This Week in the Market Stocks maintained their volatile ways as opening gaps were met with considerable intraday moves. When the dust settled Friday, not much had changed from the previous week. The S&P 500 was unable to move past the 4,000 level and is still below its 200-day moving average. Looking ahead, the most likely scenario this week is for the volatile moves to persist. Until the S&P 500 can either break above 4,000 or below 3,900 decisively, there will be no clear direction. Implied volatility levels continue to wane. It is one of the shortest trading weeks of the year with the market closed Thursday for Thanksgiving and closing early Friday. As you might guess, implied volatility levels and option prices for this week’s expiration are lower than normal because of the shortened trading week. There will be fewer economic reports as well, with almost all of them set for release Wednesday. What traders and investors may be paying attention to are the notes from the last Federal Reserve meeting being released that afternoon. Clearly, that could make some waves in the market in front of the holiday. With some time off, it may be a good time to review some previous trades and tidy up the trading plan too. Have a healthy and happy Thanksgiving! Nov 23: Durable Goods Nov 23: Jobless Claims Nov 23: S&P Manufacturing and Services PMI Nov 23: New Home Sales Nov 23: FOMC Minutes [Read Our Blog](=) Basic Options Strategy (and More) I was sitting on a plane to Vegas earlier this week thinking about what is most important for option traders, and I ended up having one of those moments of clarity. The best basic options strategy is to follow the rules (see side note at bottom). Basic Strategy in Blackjack If you play blackjack and don’t get totally cleaned out every time, one of the things you probably incorporate into your playing is what is simply called “basic strategy.” Blackjack basic strategy is this pretty brilliant matrix someone figured out one day that says basically (see what I did there, “basically”? Ha!) [Continue Reading ...](=) MTM Watchlist Here are a few trade ideas we will look at in group coaching class this holiday-shortened week: SPY – We continue to extract money from the market by selling credit spreads around support and resistance levels. Expect that profitable trend to carry on this week as well. TGT – After gapping down following the company’s earnings announcement, the stock rallied higher as we modeled out a couple of bull call spreads. Expect more of the same this week. TSLA – Bear call spreads around the $200 level have worked well. With the stock now lower, new potential resistance levels will be explored for additional call credit spreads. [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 - 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