Volatility Drops While Tech Pops — Here’s How to Trade It

by | Mar 18, 2022 | Options

It’s been a positive week for stock markets — a pleasant surprise — heading into Friday’s quarterly options expiration.

But don’t get fooled because nothing has changed. For the moment, markets are being blown around by headline-driven sentiment…

And when that sentiment is optimistic — or at least not getting worse — markets rally like they have this week.

As I expected, this week’s rally was led by beaten-down big tech names like Microsoft Corp. (Nasdaq: MSFT), a New Money Crew Weekend Watchlist member, and the chipmakers.

And with inflation and war fears pushing volatility to extremes, it was a fantastic time to sell some premium…

Which is why my Weekly Trade Alliance strategy took aim at Advanced Micro Devices Inc. (Nasdaq: AMD)!

Weekly Trade Alliance Dazzles in Debut

In addition to trading bull put credit spreads, I also include a bonus call position members can choose to take to help bolster their trades.

On Monday, I targeted the March 18, $103 strike call… and it did not disappoint!

The option was right at the money when the alert was sent… And by Wednesday, shares peaked above $115, spiking the calls for a 340% max gain from Monday’s closing price!

And because we structured our spread with a worthwhile risk-reward ratio, we’re poised to return $30 for every $70 risked — a 42% gain!

Not every week is going to be this fantastic, but it was a great way to kick things off for the Weekly Trade Alliance!

Come Monday, we’ll be back at it, putting the Point30 strategy to work again…

With that in mind, let’s check the tape and see what traders should have on their radar for the week ahead in the New Money Crew Weekend Watchlist!

New Money Crew Weekend Watchlist for March 18

It had been a brutal quarter for tech companies to start 2022, with the tech-heavy Nasdaq taking a 20% nosedive since the start of the year…

And losses have been even worse for some of the biggest tech stocks on the market like Netflix Inc. (Nasdaq: NFLX), which has taken a 35% haircut in that time — ouch!

When market momentum turns, this correction will be a great opportunity for traders to pounce on top companies at lower prices.

Don’t get me wrong, this isn’t time to get married to anything… But that doesn’t mean we can’t take advantage of the calm in the volatility storm in the near term.

That’s why New Money Crew is going to look for breakouts in top tech names over the next few sessions.

Among the names hitting the Blitz Tracker early and often this week is Nvidia Corp. (Nasdaq: NVDA). NVDA, along with AMD, have been two of the best movers in the S&P 500, with NVDA gaining about 20% on the week. But with shares trading around $261, the stock is still 24.5% off of November’s record highs….

a stock chart for Nvidia (New Money Crew Weekend Watchlist)

And with the strength we’ve seen this week, New Money Crew will also add Advanced Micro Devices Inc. (Nasdaq: AMD) to our watchlist as well. The cutting-edge processor producer is still seeing short-term institutional order flow, even after this week’s 10% run higher.

Rounding out the new names, the New Money Crew Weekend Watchlist looks to… China? 

a stock chart for Alibaba (New Money Crew Weekend Watchlist)

Chinese ADR stocks have seen a resurgence on the scanner since Wednesday’s announcement that Beijing is working to calm market regulation and delisting fears in the U.S. 

A major beneficiary of the news has been Amazon rival Alibaba Group Holding Ltd. (Nasdaq: BABA). We may not see another trade hit the tracker like Wednesday’s 724% overnight moonshot any time soon, but the recent upswing has made it a top target of bullish institutional order flow.

No matter which way the market breaks on Monday, New Money Crew and Weekly Trade Alliance will be watching these top tech names with excitement!

P.S. Do hedge funds place risky bets and cross their fingers?

Of course not…

They want consistent profits.

That’s why they take advantage of a little-known market “error” that flips the odds i  n their favor

After learning this trick on Wall Street, I perfected a formula anyone can use to do this exact same trick…

From their cell phone brokerage account!

Learn the Point30 Formula

WRITTEN BY<br>Lance Ippolito

WRITTEN BY
Lance Ippolito

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