TRADE PLAN for FOMC
Hello everyone! Today i want to share some option strategies with you!
1.
$S&P 500(.SPX)$ 80% of traders lose money on FOMC weeks. If you want to be on the right side of the trade.. Read below! ✅
1. The real trend ALWAYS occurs on Thursday after FOMC. Wait for this day to take a normal sized trade.
2. Size your positions down by at least 50% to account for the volatility before Thursday
3. Focus on sector leading stocks- Don't chase rotation or random tickers- These stocks have the best predictability for direction
4. SPX premiums are priced at 2.5x for Wednesday so expect to see 80+ pt move minimum. Don't get caught off guard by the volatility
2.
$Goldman Sachs(GS)$ dropped 23% in 4 weeks. Is it ready to lead the market higher? ✅
Even with the market selling off today, GS showed relative strength while most of the market was moving lower. Pockets of relative strength in a down market can present a good opportunity to catch a bounce especially if there's a positive reaction to FOMC.
With FOMC/Powell coming up tomorrow GS has the potential to lead the market higher. GS to 573+ in play if GS can break above 557. GS formed a strong base above 524 the past week.
The FOMC is widely anticipated to maintain the federal funds rate at its current range of 4.25% to 4.50%. There's a 99% probability of no rate cut indicated by the CME FedWatch Tool as of March 17.
It also aligns with Fed Chair Jerome Powell’s recent remarks on March 7, where he stated, “We do not need to be in a hurry and are well positioned to wait for greater clarity.” This suggests a cautious, data-dependent approach, with no immediate urgency to adjust rates following three cuts in late 2024 (a 50-basis-point cut in September, and 25-basis-point cuts in November and December).
Keep a close eye on GS as it is my favorite name for the upside going into FOMC tomorrow.
GS March 21 570C is best above 557 📈
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3.
TRADE PLAN for FOMC Wednesday ✅
$S&P 500(.SPX)$ if there's a positive reaction to FOMC, Calls can work above 5646 for a move to 5700. SPX under 5600 can drop to 5537
$Meta Platforms, Inc.(META)$ dropped 175 pts in the past month, META above 588 can test 600,610 by Friday.
META 600C is best above 588
$Invesco QQQ(QQQ)$ under 469 this week can drop to 449 by April.
QQQ 465P is best under 469
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