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Friday, September 5th
“There is nothing like being left alone again, to walk peacefully with oneself in the woods. To boil one’s coffee and fill one’s pipe, and to think idly and slowly as one does it.”
– Knut Hamson
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Markets Today
🌏 Asia-Pacific: Up
🇪🇺 Europe: Up
🇺🇸 United States: Up
🛢️ Oil: Down
⚡ Crypto: Up
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Major wins on AAPL, TSLA and NVDA…
And *NOW* this 87% accurate “stock finder” is flashing on a new ticker!
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Major Market Events
- Jobs stall, unemployment ticks up — U.S. added just 22,000 jobs in August, well short of forecasts, while the jobless rate rose to 4.3%
- Tesla unveils $1T Musk pay plan — Shareholders back a performance-based package that could net Elon Musk up to $1 trillion over the next decade
- Fed uncertainty clouds markets — Stocks swung as traders weighed weak labor data against Trump’s push to reshape the Fed and rate-cut hopes
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🤔 My Thoughts
Market Makers Run the Table — Read the Rules
Stop guessing and let the pricing tell you what to do
Yesterday on Profit Panel, Jack Carter broke down why so many recent “earnings lotto” trades got crushed on names like NVDA and AVGO.
It wasn’t bad luck. It was pricing.
Market makers set the odds. Going into big events (like earnings), they raise options prices to match the move they expect.
If the stock only moves about what’s already priced in, straight calls and puts can go to zero.
Here’s the simple, repeatable way Jack framed it — and how you can use it.
Start with the expected move
You don’t need a fancy tool. Look at the prices of the at-the-money call and at-the-money put for the same expiration and add those premiums. That total is the market’s rough “speed limit” into the event.
If the expected move is ~2% and you’re buying options that need a 5% jump just to break even, you’re not trading the market—you’re wishing.
Pick the right role for the day
There are only two roles:
- Buyer (rare; only on real surprises). If a headline truly blindsides the market (Jack mentioned the recent GOOGL antitrust court ruling), a small, defined-risk directional buy can work. Size tiny. Take profits fast.
- Seller (most of the time; define risk). When the move is pre-priced, favor defined-risk premium selling: covered calls, cash-secured puts, or small credit spreads. You put time and pricing on your side and cap the downside.
Two plain-English cues
- Delta ≈ probability. A 0.20-delta option is roughly a 20% shot of finishing in-the-money. It’s a helpful gut check when choosing strikes for income trades.
- Simple levels. Use obvious lines (e.g., a 50-day moving average or a recent price shelf). Selling a put under support or a call above resistance keeps the story simple.
A tiny, defined-risk example
Let’s say a stock is at $100. The expected move into Friday is about $2.
Instead of buying a call that needs a bigger-than-priced jump, consider a $105/$107 bear call spread for a small credit.
If price stays under $105 (or just wiggles inside the $2 move), time decay helps you. If it rips, your max loss is capped and you exit.
Takeaway: Respect the expected move, choose your role, define risk, and let the clock help you—not hurt you. That’s the edge Jack highlighted: stop guessing; let the pricing tell you what the market already expects.
Click here to watch the on-demand replay!
And don’t forget to register your spot here to join us next time we go live!
To Better Trading,
Alex Reid
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