Trade Ideas | 8/21/18

August 21, 2018

The market is making new ATHs today and IV remains suppressed across the board unless you're trading Turkey, Brazil, or Tesla.

 

For these ideas, I'm looking to increase positions in the portfolio because it's getting a little low and to mix new positions between high and low IV strategies, as well as throw in a few bullish bets due to the market overall pushing higher. These ideas will all be for the October expiration.

Charts and Risk Profiles in the gallery below.

 

$EWZ - not following along with $EEM, which is up big today. Had a rally and then lost it. I think $EWZ is a good candidate for an Iron Condor as the short strikes used contain the entire 1SD move, but if it moves rapidly towards either short strike you could be looking at larger unrealized losses than the other trades talked about here.

 

$DIS, $TLT, $QCOM - all of these stocks/ETFs are good candidates for Iron Butterflies (or very tight Iron Condors), which have done surprisingly well this Summer during these low IV times. Each idea has wide breakevens that encompass recent highs/lows and support/resistance levels.

 

$UPS - this stock had a huge earnings gap to the downside but is now looking to fill that gap. I'd be cautious here, and get out of any long position if $UPS trades below the recent high, which was former resistance and now support, at 121. Exit the long position at the gap fill just above 126. 

 

$SBUX & $XLF - both of these stocks/ETFs are at resistance and looking to breakout. While you obviously can position for them to breakout, I've found that it's better to wait until a breakout is confirmed before entering a bullish position. Keep these on your bullish watchlist.

 

 

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