What an epic move after the Fed announcement. But the move was the wrong direction.
It makes no sense why the stock market is rallying when the rates are increased and the Fed indicates that they will continue raising rates.
My anticipation for a downwards move backfired but, according to a reliable study, the market has a high probability of returning to the pre-announcement levels within 48 hours.
Due to the size of the move upwards I did not want to hold off rolling my put side up any longer so I made some adjustments in my SPY and QQQ positions. I also rolled up my put side on my W position and closed a couple of my earlier trades with great profits.
For those, who are new to my daily market comments, I place and document one of my options trades each day with the objective of helping everyone learn how to trade options.
What's my trade for today?
#UNG (#UnitedStatesNaturalGas) short put. This ETF is at levels we have not seen since 2017 and have only seen 2x in the past 20 years. It is possible that the price will remain around its current level for some time but I am fine with that as this is a very low risk trade.
Trade Type: Short Put
Expiry: 17 Mar
IV Rank: 60
Cap Req: $336
Annualised Prof at Expiration: 202%
IMPORTANT: Studying previous trades provide the opportunity to everyone to learn a great deal so I encourage you to click on the links below and digest the info.