We are still in the realm of high volatility with swings either way of 1% or greater. For a credit spread trader this is the sweet spot since we are able to place 7 day trades with over 150 points away from the market. Premiums are rich and we are easily able to adjust trades if necessary. There is no better way in my opinion to make consistent returns.
There are still a lot of headline risks in the markets now with the debt ceiling and infrastructure debates happening. At the same time, continued bottlenecks causing supply constraints and inflation. The good news is that these are well known issues and the market is able to price them in. So the market is staying within a range as more information comes out over time. There have been a lot of downgrades in earnings so that is also being priced in. As long as there are no big downside surprises, the market will digest and move on. Use the opportunities to add to your long term positions since these dips are opportunities to buy. Just look back several years and it will give you confidence that this volatility will pass and markets will go higher.
Founder | SimpleOptionStrategies.com
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