Market comments 20220422

What a day... I bet many shed tears today.

Could this be the beginning of a major collapse in the stock market?

Is it possible that the complacency I talked about not long ago is finally dissolving?

The good news is that when the market is risky then option traders can make more money then in periods where the volatility (VIX) is below 10 for an extended period of time. Provided that they are on the favourable side of the trade...

But how do we know what is the favourable side?

Well, if anyone knew that then they would eventually take the money of the entire world.

What we can do is to play non-directional trades, like strangles, but we must ensure that we keep a very close eye on our positions.

So what's my trade for today?

#AAL ( #AmericanAirlines ). It's a cheap stock with barely any move on a day where almost every other stock plummeted. The stock recently enjoyed a bit of rally but I certainly wouldn't be able to tell where it would go next so it seems perfect for non-directional wide strangle ($16.5 / 23).