Good question, right? Investors turned bullish again as we started earnings season and banks turned out strong. Jamie Dimon, who recently warned us about gloomy future as the most dangerous time the world has seen in decades suddenly turned around with bullish claim that the earnings recession may be over (whatever that means).

We only have a headache in front of us tomorrow (retail sales report) that may shake the recent rally. Who knows what Wall Street will do. If the sales come in strong indicating that consumers are confident and spending like crazy (which they are), it could indicate a strong economy. Wall Street may take it bullish as soft landing will be very likely, or they may take it bearish out of fear that this may keep inflation high and the FED rising rates more. Flip the coin.

Today’s trading was well below our “Crumbs” Iron Condor we opened last Friday. In my trade reports I indicated that the upside and downside protection was so good that it would be almost impossible for the trade to go bust. Of course, anything can happen, but the market would have to either rally or crash more than 2.4% in a day. This could happen only in a crazy bear market (in 2020 and 2022 we had a few 3% daily crashes, in 2022 we even saw a 4.41% crash on September 13th). So, this can happen. But we are not in this environment anymore.

 

 

Despite crazy selling on Thursday and Friday last week and another crazy rally today, the trade expired worthless and finished with a nice 2.36% profit (after fees) in 3 days. Annualized profit was 102.61%. I would gladly collect this every other day. We opened a new trade with Wednesday’s expiration. Our protection is again below 2% on both sides. the chances that the market would rally tomorrow and on Wednesday more than 2% (or crashes) are there but the odds are slim. In a normal market, this trade should expire worthless.