The Broader Markets

Last Week – SPY was down about 1.7% last week, more than the 0.8% expected move options were pricing.

This Week – SPY options are pricing a 1.5% move (in either direction) for the upcoming week. With the SPY around $445 that corresponds to about $438 as a bearish expected move and $452 as a bullish expected move.

Implied Volatility – The VIX was higher on the week and ended Friday at about 21, up from 16.50 to start last week. It is now higher than its historical average. December VIX futures are about 23, higher than last week.

Expected Moves for This Week via Options AI:

The major ETFs are all pricing larger moves for this week than they did last week:

  • SPY 1.5%
  • QQQ 1.6%
  • IWM 2.3%
  • DIA 1.5%

The 1.5% expected move in the SPY is higher than the historical average. An Iron Condor with short strikes set at the expected move (based on the close Friday), needs the ETF to finish between $438 and $452 to see Max Gain. Here’s an example on the Options AI chart, showing the risk/reward, breakevens and probability of profit of a $1 wide condor at the Expected Move.


In the News

Expected moves for the week in Bitcoin and Ethereum, based on crypto options:

  • BTC 6%
  • ETH 8%

Expected Moves for Companies Reporting Earnings

Options AI puts the expected move at the heart of its trading experience. Traders are able to quickly generate credit and debit trades based on the Expected Move, or to their own targets in context of the Expected Move. More education on Expected Moves and options trading can be found at Learn / Options AI.

It’s a light week for earnings report with Oracle the largest company of note reporting:


Monday

Oracle ORCL / Expected Move: 5% / Recent moves: -6%, -7%, +2%

Tuesday

Fuelcell FCEL / Expected Move: 13% / Recent moves: -11%, -10%, +3%


Based upon publicly available information derived from option prices at the time of publishing. Intended for informational and educational purposes only and is not any form of recommendation of a particular security, strategy or to open a brokerage account. Options price data and past performance data should not be construed as being indicative of future results and do not guarantee future results or returns. Options involve risk, including exposing investors to potentially significant losses and are therefore not suitable for all investors. Option spreads involve additional risks that should be fully understood prior to investing. Securities trading is offered through Options AI Financial, LLC a registered broker-dealer.

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