MTM Options Trader Newsletter - A Look at IV Levels Around Earnings

[image](=) [image] This Week in the Market The major indexes were able to inch a bit higher as volatility moved markets, especially toward the latter half of the week. The latest FOMC announcement and statement afterward was most likely the cause. Looking ahead to this week, the markets are still extended away from their 50-day and 200-day moving averages. But until proved otherwise with some breaks of major support levels, a non-bearish bias looks like the way to go. Implied volatility and option prices continue to drop as the market refuses to move lower. There are not as many economic reports as last week, but several are expected, including the July jobs report before the open on Friday. Quarterly earnings continue to roll in with Apple and Amazon among the big-name stocks traders and investors will be keeping an eye on. As always, be sure to check and double check the expected earnings date before taking any trade. Have a healthy, safe and uplifting week! Aug 1: JOLTS Aug 1: Construction Spending Aug 3: Jobless Claims Aug 3: U.S. Productivity Aug 3: Factory Orders Aug 4: Unemployment [Read Our Blog]( A Look at IV Levels Around Earnings If you don’t trade options over earnings announcements, you may have not noticed what happens to implied volatility (IV) levels. Usually an expected volatility event like earnings increases the price of options. In other words, when implied volatility increases, so do option prices. That can give an option trader an edge, but that edge is based on a volatility event. Let’s take a quick look below at a recent example. General Electric Co. (GE) was trading at $110.56 the day before its earnings announcement, which came before the open the next day as seen below. [Continue Reading ...](=) MTM Watchlist Here are a few trade ideas we will most likely consider in group coaching class this coming week: SPY – Despite low IV levels, long double calendars will be given another look. If they make sense, a few will be modeled out. NVDA – With a couple of potential resistance levels standing in its way, bear call spreads above the $480 level will be explored provided the stock does not open the week on a bullish run. TSLA – Bull put spreads were effective last week, but as the stock bounced around potential long neutral calendars will be examined this 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 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. [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