Options Trading Webinar: What Does Q2 Have In Store For Us?
Now that the chaos of Q1 2016 is nearly behind us, it’s time to focus on what’s coming ahead. During this options trading webinar, we discussed the current state of the markets, the strong month of March, and how things look going into Q2.
Currently, the markets are well-positioned for a healthy Q2. The nonstop selling in January and February were followed by March’s strong and decisive rebound. The SPX 500 hit a high for 2016 this week, and the other indices are not far behind. This widespread rally is indicative of institutional sponsorship, which bodes well for trading in Q2.
First Quarter Market Review
We started our webinar as usual with a state of the market address. Shockingly, the markets ended higher for Q1, an astonishing feat in a bear market, especially considering that on February 11, we were looking at a 12% deficit. In fact, from December 30 to January 31 the SPX 500 was down just a measly 4 points. But the chart really tells the picture of big time volatility.
The VIX has slid down to dangerously low levels, and while that doesn’t mean a selloff is imminent, it surely means we have to be cautious. The bear market is still alive, and as such we need one hand on the exit door at all times. Protection is cheap, so adding some would be a prudent move.
During our market discussion we went over some names and discussed some interesting stats about the market action and potential future action from my good friend Ryan Detrick:
- The S&P 500 is up +7% in March. You ready for this one? The next month has been higher 9 of the past 10 times with a +3.3% average return.
- With a day to go, SPX has moved at least 1% only 3 times during the month of March. Avg of 9.2 the past 6 months.
- Since WWII, when both January and February are lower and March is green …. the S&P 500 in April is higher 8 of 10 times with an average return of +3.4%.
- The SPX advance/decline line made a new all-time high Thursday based on good internal strength.
- 317 stocks in the SPX are up YTD, with a median return of 3.88%.
This Week’s Market Action
The VIX was stretched as we headed into the week, but as the markets pulled in a bit, the tension eased. Of course, Fed Chair Janet Yellen’s announcement that there would be no new rate hikes in the foreseeable future helped stoke a big rally. Breadth has been outstanding, puts/calls were pushed lower, and turnover has been decent. Economic data continues to be anemic, though.
Options Trading Webinar On What To Expect in Q2
Watch the webinar to get insights on the market and what to expect as you trade in Q2.
If you love the insights you gained in this webinar, don’t miss your chance to join us live. Each week Explosive Options hosts a FREE options trading webinar during to discuss recent market action, current plays and charts of interest, along with the trends that may affect future action. Join us live and get your chance to ask your own trading questions!
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