Hey Advanced Traders!
Let's talk about what's going on in the markets.
Market Sentiment
After some observation of how the markets are moving as a whole, I'm noticing that there is still a bit of a concern about the Omicron Variant spreading. Because of this, I currently would not recommend purchasing any LEAPS just to be on the safe side.
What do I recommend instead?
For me, I would continue to sell covered calls as I'm noticing that IV has been slowly increasing. This makes it a good environment to be an options seller, rather than a buyer.
I'm also going to observe how the week ends and how certain stocks perform. If I see a pattern of some of our stocks trending neutrally or even slightly downwards, we may switch gears into setting up some spreads to collect some premium while we wait for the markets to "shrug off" their concerns.
Conservative Stocks
To be a good investor and trader, it's important to observe how markets react to certain environments. If the Omicron Variant continues to persist, we can focus more on the stocks that did well during the March 2020 retracement. Some of the stocks I will be eyeing are MSFT, AAPL, COST, HD, and LOW, since these companies pay a dividend and do well during a stay-at-home environment. Like always, this doesn't mean that we should put all of our money into these companies, but we should still take a conservative approach to see how they move over the next few days. If we see institutions putting their money into these safer stocks, which is often known as a "flight to quality," we can follow suit and slowly scale our positions.
In the end, I believe that we will continue to move forward in the long-term. We've already experienced a nation-wide shutdown and know how to prepare for it.
Stay patient and disciplined.
Steve and the Call to Leap Team
The following article is strictly the opinion of the author and is to not be considered financial/investment advice. Call to Leap LLC and the author of this article does not claim to be a registered financial advisor (RIA) or financial advisor. Please visit our terms of service and privacy policy before reading this article.
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