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Volatility is king

In case you haven’t noticed, the market has been incredibly volatile for the last three weeks. 

On Friday the S&P closed up 8% on the day, after being down 9.5% on the previous day — the worst day in the stock market since the October 1987 crash on Black Monday. It was a pretty historical move. 

As I’m sure you know, it’s been pretty crazy out there.

Where is this particularly present?

The VIX.

Check out the chart below:

The VIX spiked up to a high of 77.57 this week — a value not seen since the 2008 financial crisis. 

Of course, everyone wants to know, “Is this 2008 all over again?” 

I wrote a newsletter about this earlier. But to answer your question in short, yes, I do believe it could become another 2008. But, that isn’t the focus of this newsletter.

My focus here is to talk about what we do, in this market, every day. 

For me, I’m focusing on quick, intraday and overnight trades.

There is no swing trading here. I’m not buying a short squeeze on TSLA, or holding long calls on a Phoenix stock for a couple weeks. Things have changed, as they do, oh so often in the market. 

One of the most important aspects of being a successful trader means being able to ebb and flow with the market — along with learning the patterns that enable you to get in (and out) of the market at the right time.

Friday I closed out the cash session in our trading room. I was waiting for one of my favorite setups to get moving. I knew it was about time. I’ve been trading it a couple times per week, either in our live trading room or my Mastery program. 

And so, I picked up a *single* contract in the Nasdaq futures. Just one. I figured, I’ll pick one up to close out Friday.

30 minutes later and $5,185 later, I can say it’s been one of my favorite market closes to date. 

I also threw in some QQQ calls to trade the same move using options, on the ETF. 

On this move, I risked a bit more. Since futures are more leveraged than options, you can use less margin ($500 per contract, in Infinity) to trade the same move. This was actually a relatively small trade, where I risked only $900 and ended up closing it out for around $2,600 profit in the same 20-30 minutes as I scaled out. 

Anyway, I know the market has been crazy. Don’t get me wrong.

A couple years ago, I never would’ve dared touch a market like this. But, with my experience, I now absolutely enjoy coming in on a move like this at the close and nailing it. Of course, moves like this don’t happen everyday, BUT, they’re happening very frequently with the current volatility in the market. 

If you want to learn more about trading futures…

I wanted to let you know that because of these market conditions, I’m having a special on my pre-recorded class, Futures Freedom Plan, that I taught with futures expert, Raghee Horner.

It’s now available for 20% off for the next few days. Why? I don’t trade futures all the time. You know me, I’m primarily focused in the options market. But, when the time’s right, it’s time to strike.

And, I’m going to take my 5k and go to Las Vegas, because I’ve been dying to go.

1 thought on “Volatility is king”

  1. Nice, It has been an honor and a privilege to have been able to follow along with you during your journey as a trader. What you have brought to the table has been concise and to the point. With your direction and the influence form the Team at Simpler I have been able to make nice gains during the COVID-19 correction of 2020.
    I applaud the ‘level headiness’ of the Team and the direction given.
    John, Henry, Bruce, Raghee, Caroline, Danielle and the rest of the Team are something special, the real deal! I am so enjoying the newer additions to the team.
    Again, thank you and all the best for all future endeavor’s, most importantly good luck at Vegas!

    Reply

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