The markets had a red week with the DOW30, S&P500, and NASDAQ ending -2.08%, -2.90%, and -1.49%, respectively.
Markets ended lower this week. There's a Fed Reserve meeting coming up on November 1, as well as Q3 earnings, so there might be some uncertainty in these upcoming weeks.
SPY
QQQ
Right now, we are at the support line in our upwards channel. Let's be cautious in the next few days since we might break down from the channel.
So what happened this week?
The U.S. House of Representatives is currently facing a political impasse in electing a new Speaker. U.S. Treasury yields increased on Wednesday, reaching multiyear highs. The 10-year Treasury yield rose over 4.9% for the first time since 2007, marking a gain of about 6 basis points. The Federal Reserve has decided to temporarily stop its ongoing efforts to fight inflation by maintaining its benchmark interest rate, offering borrowers relief following 11 rate hikes implemented since March 2022. Last month, the Fed's announcement maintains the federal funds rate within a range of 5.25% to 5.5%, consistent with its previous decision in July. With all the news about the government and wars, the markets may be uncertain with everything going on. If you are aware of this uncertainty and comfortable with the potential risks, you can consider making these trades below.
Steve's Trades
AMZN
AMZN Bear Call Spread
Expiration Date: December 1, 2023
Step 1: Buy 1 $170 strike call option (delta 0.02) for $10 Step 2: Sell 1 $144 strike call option (delta 0.16) for $136
Step 3: Set up a buy-stop order of 100 shares at $143
Credit/premium received: $126
AMZN looks similar to SPY, where it's on the support line of the upwards channel. Let's see how it performs next week as there are earnings on Thursday, October 26.
As a friendly reminder, we can continue to sell covered calls on our existing shares around 45 days out of expiration. For now, with the earnings coming up, we can keep our premiums and biweekly/monthly deposits as cash, until after the earnings reports come out. Once we see some technical evidence that we're going higher and positive market sentiment, I'll start to add onto my positions. Right now, I'm going to be on the cautious side and keep my cash as cash.
And yes, cash is a position too!
Earnings Starting next week, here are the upcoming earnings dates for the companies that we currently invest in: GOOGL Oct 24, 2023 MSFT Oct 24, 2023 MA Oct 26, 2023
V Oct 26, 2023 AMZN Oct 26, 2023 AAPL Nov 1, 2023 AMD Nov 1, 2023
SBUX Nov 2, 2023
DIS Nov 8, 2023
HD Nov 8, 2023 As always, stay consistent with your investing and you'll be on the right track to financial freedom.
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