Stocks have stalled and look top heavy after this recent rally.
A recent market tell for a sharp pull back has been when the CBOE market volatility index (VIX) pulls back into the 20 level.
Right now, prices of the VIX are trading at that level, which means we can see volatility pick up.
Now, we have two new buy signals that will help us in a volatile market.
Here's what we're doing...
- Buy-to-open the ProShares UltraPro Short Dow30 (NYSE: SDOW) Feb. 12, 2021, $12 call (SDOW210219C00012000) up to $0.25 per contract or better, for the day.
So, we’re going to set our profit target at $0.50. And since the contract is $0.25, we will risk the full premium.
SDOW is seeing bullish call buying triggered after a $9 million Hot Money bet that shares will move higher by next week, which is a 3,800% surge in new call options opened.
These calls will increase if the Dow Jones Industrial Average sees a sharp pullback similar to what we saw on January 21st.
- Buy-to-open the SOHU COM LTD ADR (NASDAQ: SOHU) March 19, 2021, $22.50 call (SOHU210319C00022500) up to $1.00 per contract or better, for the day.
So, we’re going to set our profit target at $2.00. and our stop-out price at $0.40 per contract.
SOHU is seeing bullish call buying triggered after nearly a $1 million Hot Money bet that shares will pop higher in the coming week, which is a 300% surge in new call options opened.
Now, let’s manage our risk before entry and let the market come to us. And I’ll be keeping you updated every step of the way.
To your wealth, freedom, and options!
Joshua M. Belanger