loader image

Trade Volatile Markets Like a Pro With Options Spread Strategies

by | Feb 15, 2022 | Crypto

Monday might have been Valentine’s Day, but there weren’t any champagne bottles popped or roses passed out in the stock market.

The week is starting off slow and choppy with headlines about Russia and Ukraine hanging heavy over Wall Street.

The S&P 500 dipped as much as 1.2% before markets whipsawed to a flat finish.

Things are looking brighter on “Turnaround Tuesday” as tensions in Eastern Europe showed signs of cooling off.

That news helped pop all of the indexes back in the green, though institutional order flow is still light.

When the news cycle blows the markets around the way it has this week, it can be tough for traders to find shelter from the storm…

We can only trade what’s in front of us, so those who can’t stand to stay on the sidelines should look to limit their risk with earnings options spread strategies…

Limit Risk in Choppy Markets Through Earnings with Options Spread Strategies  

You don’t need to hang around the New Money Crew for long to know we like to trade short-term catalysts aggressively…

And in uneasy times like this, that can be a tall order as market makers spike the implied volatility and options premiums. 

That can make trading to the upside even harder as the expected move in the option needs to be even bigger to make the possible reward worth the risk.

What could be the silver lining in all of this is there are several tech companies with weak charts slated to report earnings this week… names like Palantir Technologies Inc. (NYSE: PLTR) and Roku Inc. (Nasdaq: ROKU).

Traders who are uncomfortable swinging for the fences buying straight put options can look to limit risk with earnings options strategies like bear put spreads…

A bear put spread is a strategy involving two different put options… You buy one put with a higher strike price, and sell one short put with a lower strike price.

Both puts need to have the same underlying stock and the same expiration date, and the trade gains in value when the underlying stock price moves to the downside.

Of course, with any spread option strategy, you want to make sure your max return is worth the risk — especially during earnings. 

Check out the quick video below and let me show you what kind of risk-reward setup I look for when taking an earnings options spread strategy trade. The example here is to the upside, but the same principle applies when looking for downside returns.

Just remember to be careful out there — trade small and stay nimble.

P.S. We can’t wait for everyone to see the contents of this video…

Because a recent shift in the market has forced WealthPress Senior Strategist Roger Scott to rethink one of his biggest trading rules! 

Now, he’s taking a second look at a powerful signal he used to ignore…

Because when seeing a trade rocket 80% in 120 hours, that tends to turn heads.

And it’s all thanks to one incredible trader he’s ready to introduce to everyone!

See These Incredible Circumstances

WRITTEN BY<br>Lance Ippolito

Lance Ippolito

What to read next

99 Problems and a “Pivot” is One

99 Problems and a “Pivot” is One

A friend of mine sent me this chart about three months ago. I should probably print it and keep it in my wallet next to a photo of my daughter. Given the sheer number of questions I’ve fielded lately, I’ll probably end up showing this chart more than her picture.

read more
Everything Everywhere, Going Down, All At Once

Everything Everywhere, Going Down, All At Once

When our momentum reading went negative last week, I didn’t know that we’d have the second largest bank failure in U.S. history three days later. All I knew was that it went negative… and that we got out of the way.

read more
Trust But Verify…

Trust But Verify…

I want to talk about our version of “Trust but Verify” in the markets. Qualification is the most important part of the investing process. And this F score value strategy looks to be crushing the current market.

read more

Have any questions? Contact Our Customer Service Team