Market Alert: Hedging Time?
Equity markets find themself near the top of the range again, with multiple concerns @ hand:
• FED rate cuts priced in by year-end
• Debt ceiling standoff
• Lofty tech valuations
Is it time to place some hedges?
Enjoy this teaser of our Macro Options Daily research report ☟
➠ SPX Resistance Zone
σ 4200 on the SPX (420 on SPY) seems to be a strong resistance zone.
Potentially needing a catalyst to finally break through.
While we don’t foresee the break happening in the short term, we’d be cautious about selling calls at low upside vol levels.
➠ Strategy: Medium-Term Put Spread
σ With a steep term structure, plus the risk of vol rolling down and an elevated skew, we would recommend you consider owning medium-term put spreads.
This approach can provide downside protection if the market adjusts to the headwinds listed above.
➠ Remember, it’s crucial to keep an eye on the changing market landscape and adapt your strategies accordingly.
Stay vigilant and good luck out there!
➠ Get more color on this in the attached clip from today’s Macro Options Spotlight
➠ Watch today’s full Spotlight video ↴
Crucial Market Gaps You Can’t Ignore! | Hedging Tips | Macro Options Spotlight | May 11, 2023
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And we often leave out the juiciest details, like trade ideas.
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