Market Outlook Live! (Jul 2, 2026)

DT takes a quick look at what the markets are doing today.  Feel free to post questions and comments in the YouTube chat.  Super Chats are always appreciated and are more likely to get a response.

JOIN THE COMMUNITY VIA PATREON/DISCORD:
Become a "Premium Member" by subscribing on Patreon ( https://www.patreon.com/dtoptions ).  This gets you access to the Discord, including the daily voice chats on market days, as well as access to exclusive video content posted on Patreon, including all of the daily voice chats in their entirety.

BUY DT'S BOOK
🛍️ The Super Wheel Options Strategy: https://amzn.to/3v7gAXh

Transcript

SPEAKER_00 0:00

And we are live. Welcome to another edition of Market Outlook Live. I hope everybody's having a lovely day today. It's the last trading day of the week. So today, obviously, is a holiday shortened week. So tomorrow is Friday, July 3rd, and the stock market will be closed in observance of the July 4th holiday. Since July 4th falls on a Saturday, they still have to give a holiday to everyone. So they're going to give them Friday the 3rd. So the major exchanges, the New York Stock Exchange and the NASDAQ, will be closed. So no trading of stocks or stock options tomorrow. So we will not be here for a market outlook tomorrow. The futures will trade for a half a day. So the futures markets will open at their normal time this evening and we'll trade till noon, Central Standard Time tomorrow. So you'll get a half a day of trading in the futures. The futures markets, though, on a holiday, on a half day like that, typically you're not going to have very good volume. I wouldn't bother trading if you, for whatever reason, need to go make some adjustment to a trade. You do have the opportunity to do that on a half day, but I would just take care of anything you need to take care of today and not bother trading tomorrow. So right now the market is a little bit of a mixed bag today. We pull up the stock chart here of ES. Let's go ahead and look at the SP 500 futures here, the ES futures, up 12 points, up 0.2%. We've had a little bit of a range. We have been down slightly this morning, then we've been up quite a bit uh later in the morning, and now we've sold off to we were red just a minute ago, now back in the green. This is a market that, at least with the SP, doesn't really know what it wants to do today. The Nasdaq futures tell a similar story, although the NASDAQ is a little weaker, and I think I suspect why the NASDAQ is a little weak today. Right now, the Nasdaq is down 270 points, down 0.9%. It was green on the day earlier in the morning and has since sold off in a big way. And I think that is in large part to one of the big components of the NASDAQ, of course, is Tesla. Tesla is down 28 points on the day. That's a 6.5% decrease in uh Tesla today. Now that is news driven. Tesla today was the big day where they uh report their deliveries, and the report was good. Tesla reported 480,000 deliveries and vehicle production of 451,000 and change for the second quarter, and that did exceed expectations on both of those numbers. So why is it selling off? I don't know. One of the things when it comes to news, economic reports, earnings reports, I often tell people, you know, no matter what the report says, no matter what comes out, whatever numbers come out, you never know how the market will react to anything. So that's why I don't really take um much stock in uh fundamental analysis. I don't do any fundamental analysis at all because it's a waste of my time, I think. Um, and really technical analysis, I'm not much of a technician, although I'll keep some moving averages on the chart and I'll pay attention to some basic support and resistance levels that are obvious to the naked eye. But for the most part, when it comes to fundamental analysis, uh, you know, your guess is as good as mine as what the market will react to any report because traders are humans. Humans are emotional beings, right? They're emotional creatures. You never know how an emotional creature is going to react to anything. So the ES up very slightly. The Nasdaq now down, well, selling off as I'm talking about Tesla down 1.1% now, down 325 points. Kind of an ugly move. The Russell down half a percent on the day, down $14.60. Yeah, pretty uh, pretty good down moves in the Nasdaq and the Russell. Right now, the SP is barely able to keep afloat, but it looks like it wants to go red here in just a second. If we take a look at VX, the volatility futures here, the VIX futures, uh down 15 cents. So the VIX futures are telling you that they're not worried about this market, right? Down 15 cents, that's where that's been pretty much all morning. It hasn't changed. Trading at 17.95. If we're looking at the actual VIX index, VIX, also down on the day, down 28 cents, trading at $16.31. So the market is telling you that it's uh there's not a lot of fear in this market, despite us having a little bit of a down day. Yeah, all signs kind of point to go on this market right now, despite some of the weakness in tech. If we take a look at some of the futures moving to the downside today, there's really not much that is lower. It's mainly energy. Nettie gas is down 1.6% on the day. Crude oil, the CL futures, are down 85 cents. That's a 1.25% decrease in CL. Right now, CL trading at $67.72 a barrel, and that is as low as it's been since before the war. That gets us actually before this gap up here, where we gapped up and then sold off that day. If I zoom in, we're actually trading back below that first little gap up where you know the the run up after that happened. So the move and CL, I I've been saying this for really a couple of weeks at least. You know, I said it back here that you know when we were trading sideways there around the 90 to 95 range that the move and CL was done. But certainly now in the last three weeks, as we've really fallen hard, yeah. I think uh it's been priced in. Whatever kind of tensions go on in the Middle East from here on out, the market has priced all of that in, and they are moving on. Uh that they're trading with all of that in mind, and they don't care. Some of the futures moving higher today. Uh, Bitcoin's having a good day, up 2.5% here. The BTC futures up 1,550 points, trading just under 62,000, trading at 61,710. And that's uh that's a good move. Uh Bitcoin really needed a good move because it was trading on its lows, really kind of open on its lows yesterday. So one upday, it's not gonna save this thing. We'll see if we can string together three, four green candles in a row. Maybe we can start uh getting crypto to trend back higher. Right now, it has been very ugly. Ethereum tells a similar story, having a good upday today, up 4.75% today. Good upday, but again, this is you know coming off of a low here in the last couple of days. Right now, though, the Ethereum futures trading just a hair under 1700. The metals are also having a good day. Silver, which is my old nemesis, right? I'm very long silver, but the last week or so it has been cooperating. Today it's up 1.8%, which is good for me. GC, the gold futures are up 1.3%. Similar chart to gold as far as the last uh six candles. You know, five of those candles have been green candles. So maybe we've reached a bottom in gold and silver, and maybe these things will turn around and start heading higher. That is my hope. Round out what is going on with the metals. Let's take a look at copper. HG is unchanged on the day. Some of the currencies are really moving around today. The Japanese yen up one percent. See a big green candle on this chart. And that's unusual because it's typically red candle after red candle after red candle in the Japanese yen. This chart is is seriously, it's it's a staircase, a staircase uh going down right until today. All of a sudden you get the one big green uh candle. 6E, the Euro, is up more than half a percent. Uh 6B, which is your British pound, is up well, two-thirds of a percent. So good moves in the currencies. The Canadian dollars up a quarter of a percent, the Aussie dollars up half a percent. Moving over to the bonds, ZB, the 30-year bond up two ticks. This was actually lower this morning when I got up. So some big reversals here. Uh, in the stock market was up, now it's down, bonds were down, now it's up. Yeah, some crazy moves. Actually, the move in silver was crazy. Silver was down big this morning, and then now to be up 2%. Kind of a crazy reversal in silver, but ZB right now trading at 112.23. Uh Zn, the 10-year note, up five ticks, trading at 109.23.5. And that's about a 0.1% increase in both ZB and Zn. Any other futures worth mentioning for those that happen to be playing any of the grain futures? Take a look at what corn, wheat, and soybeans are doing. Corn's up three-quarters of a percent today. That's the third green candle in a row there. So maybe the bleeding has stopped here in corn as well. Maybe it's found a bottom. Uh ZS soybeans is up a quarter of a percent. And ZW wheat is up 0.9%. Very similar looking charts. All three have had three green candles in a row after making a recent low. Taking a look at what some of the major tech stocks are doing, we've already mentioned the big move down in Tesla, which I'm sure that's part of what is holding the NASDAQ back today. But if we sort by move slower, other than Tesla, MU Micron down 44 points, and it was up earlier in the session, so it is sold off. Now trading at 987 and change, so under a thousand points, and it traded all the way up to 1250. Remember the day of its earnings, it got all the way up to 1250 and now trading at 988. Very volatile instrument, but I will say, since that high on the day it reported earnings, it has certainly trended lower here in the last six trading sessions. I don't know if that trend will continue, but this is another reason why the NASDAQ is particularly weak. Micron, a big component, a trillion dollar company, right, as far as market cap. Yeah, 1.28 trillion on the market cap. Tesla, obviously, a trillion dollar company down big. AMD, another very big company, down 22 points today. That's a 4% decline. And AMD. ARM is down 3.7% on the day, down 13 points. Trading at 324 and change there in ARM. ARM made a high two weeks ago of around $450, now trading at $324. Qualcomm is also down 3.3% on the day. Qualcomm's chart looks especially bad. We've got about looks like about 10-12 red candles pretty much in a row there. Down six dollars on the day. It's about a three and a half percent drop in Qualcomm. Intel also down on the day. Intel has been all over the place today. It was down pre-market, then it was up right after we opened, then it was down again. Right now, down three and a half dollars, trading at $123.50. Not great for me. I've got a short put on an Intel, and it's been that's been choppy. Right now I'm basically at break-even on the trade. I've been in it for two weeks on this short put. Gonna hold on to it, see what happens. Intel down a little bit today, down two dollars and forty-three cents. About a one and a quarter percent down move in uh NVIDIA, excuse me, NVIDIA down uh two dollars. Uh IBM down small, Google down small. Now the tech stocks that are moving higher, Coinbase is up five percent, but that's on the strength of what's going on with the crypto markets today. Bitcoin was up big, so Coinbase a lot of times will move in sympathy with those crypto markets. Apple though is up big, up 4.2%. Apple of the last five trading sessions has really been trending higher. Netflix is up 3.6%. Netflix though has been kind of a dog here, right? This this chart really looks bad. I don't know if the bottom is in in Netflix just yet. I I for me personally, I don't love the idea of going and selling puts in this thing just yet. I know a lot of people are probably getting long, but you gotta understand when people were looking at the chart back here, they were thinking, get long. People getting long here. Yeah, like you know, all the way down. If you zoom out, hell, people back here were probably thinking, hey, I should get long in Netflix because it's seen a little bit of a haircut. For me, I don't like trying to step in front of uh uh this kind of train, right? A train to the downside in this case. I don't like catching that falling knife. Palantir up three dollars and eighty cents today. That's a three percent increase in Palantir was trading much higher earlier, sold off a little bit since then, but still up on the day. Trading at $129.50 a share. Palantir got down to a low of around $107 a share. So it has found a bottom, it looks like, and it's starting to trend higher. So this one, yeah, I might nibble on with a short put if I needed a trade, because we've got three green candles in a row. Really, the last six candles. It looks like it found a bottom and is now wanting to trend higher. Plus, I think a lot of people, when they get out of the memory stocks, like Micron, it's looking kind of weak here recently. I think they'll rotate back into some of the software-related kind of names, like a Palantir or a Microsoft. Yeah, I think that'll be a good sign for those speaking of which Microsoft is up today again. I think you naturally you see that rotation going on. People are jumping in to some of those software-related names. Microsoft up $4.40 today, a little more than 1% up on the day. Microsoft trading at $388 and change. Microsoft traded down to a low of $348 six trading sessions ago. So yeah, it's uh about $40 above that low, six trading sessions ago now. So that's a good sign for Microsoft because its chart looked very ugly there uh for a while. Yeah, in the chat. Got Donald in the chat. Happy Fourth of July weekend. Yeah, I agree, Donald. Hope everybody has a great weekend. Hope everybody has a nice holiday, spend it with friends and family, and uh yeah, have fun, right? Eat some good food, you know, have some some good drinks, you know. Don't do anything stupid when you're having the drinks, though. Uh yeah, shoot off some fireworks if you're in a place that you can do that. And for me, I I'm not exactly sure what I'm gonna be doing this weekend. I'm sure I'm gonna be spending it with some family. I don't know where the get together will be. I don't know exactly where I'll have to travel for that event. But yeah, I'm gonna take the three-day holiday here because no trading tomorrow, so I won't be here for market outlook. I'm not gonna meet with my Discord group because obviously no trading tomorrow. So uh I may come to the office here tomorrow and do a little recording early in the day, but I'm not gonna put in a uh a long day tomorrow, and then Saturday and Sunday I'll spend it with the family. Alright, yeah. Anybody in the chat, if you got questions or comments, feel free to leave leave them. We shouldn't have much to do today. As far as it's the end of a shortened week, it's a holiday essentially that we're heading into tomorrow, which means the markets today probably gonna see light volume. I don't know if we're gonna see any serious movement in anything. I mean the Tesla move is kind of a big move. And the 1.3% move down in the Nasdaq now. Pretty serious move. I do have shares of TQQQ. Kind of an ugly trade there. Do I want to hold this over the weekend? You know, I could manage some of this with you guys. I don't think I want to hold that over a three-day weekend. I think I'll close that position. I'll put it back on on Monday if I want to get back in it. The market's really moving against me though.

SPEAKER_01 16:18

That thing moved against me in a hurry. Alright, got out of that.

SPEAKER_00 16:25

I don't want to hold 150 shares of the triple-levered NASDAQ ETF over a three-day weekend. You never know where we could come back and be trading. Yeah, yeah, it could be much higher, and I could miss out on some money, but at the same time, you can also get a big gap lower. And of course, the moves to the downside are more violent in the market than the moves up, right? The market tends to take the stairs up and the elevator down. So let me get out of that position. Plus, that position takes a lot of uh capital, right? Shares are expensive, especially especially in a triple levered product. You don't get much margin relief on a risky product like that. That position was probably taking 10 grand or more of buying power, so I'll just get out of that. And I'll come back to that on Monday if I want to keep riding the uh Nasdaq on the way up. Other positions I have is uh I've got uh put ratio spreads in the MES. I had three of them on yesterday. One of them I took off this morning with my Discord members because it was at 53% max profit, and I just wanted to get out of it, free up the buying power, because these do take up a little bit of buying power, even though you get good margin relief by using futures options. You get that portfolio style margin in the futures, the span margining system. But still, these are not necessarily small trades, you know, they're probably taking up twelve hundred, fourteen hundred dollars worth of buying power per position. I had three of them on. I went ahead and took one off because it was already at more than a 50% profit, so why not? Then I've got this one on, been on for 14 days, already at 27% profit. Just let that keep going, and then the brand new one I put on yesterday, so I've already laddered into the next 90-day put ratio spread. I always put these on at 90 days, and then I tried to stagger them. You know, every two weeks, maybe three weeks, put on the next. So sometimes I'll have as many as three or four, maybe five of these on at some point. Um again, MES, it's the micro ES futures. So it's one tenth the size of ES. It is one half the size of SPY if you're used to trading SPY. So one half the size of SPY is still not a tiny product, so don't let the name the micro e Mini futures uh fool you. You know, what if you are trading, for example, uh two short puts in the MES, it's the same as trading one short put in the SPY. And if you know that's a big position for you, then you know be careful. GDX, this is the gold miners ETF. I made a roll this morning, I had to defend a trade a little bit with the Discord members, and they got to see me make this roll. So far, it turned out to be an okay roll. Basically, I got back out to more of a standard kind of strangle. My strangle was a really tight strangle to finance rolling and to get this thing back to a normal position. I actually sold a second contract. So instead of one put and one call, I got two contracts of each. And the reason I did that is because it was already a smallish position. I didn't mind putting on an extra contract. If this was already a position that had some size to it, I would never add to the risk. But because this started life as kind of a small trade, I didn't mind adding a second contract to it. Uh, and then I need the strangle, hopefully, to sit here, GDX over the next couple of weeks. Hopefully it chops around. We cut some of this loss in half. Maybe, you know, that would be nice. And then, you know, once some of that loss goes away, maybe I can roll again. I just keep rolling for credits as long as I can and just keep fighting this trade. Hell, if I gotta be in the strangle for the next two months, three months, it is what it is. Keep rolling, keep rolling, keep adding credits until finally the trade goes my way. Of course, you know, it'll depend on how long you want to be in a trade. Sometimes when you get into a trade that seems like it's lasting forever, you gotta understand you're also taking up buying power being in a trade defending it. Sometimes, you know, if a loss is a smallish kind of loss, and this is not a terribly big loss, and if you think it's gonna take you a long time to uh get that loss back, sometimes it might be better just to close the trade and move on with life. Here you can see I've rolled six times defending this trade. So I've been in this trade for a while. I'm gonna stick it out though, just because I'm angry now and I'm gonna make sure I get that money back. Yeah, Intel here in the last uh few minutes since we uh turned on the stream here, right? Intel's dropping down 450, right? The market, the Nasdaq now down one and a half percent, the Russell down 0.8%, the ES has turned red, down 13 points, down 0.2%. So, yeah, market does look like it wants to sell off here a little bit. Uh short put, I'm fine on this though, still well out of the money. It's a 20 delta put. And uh this is a stock too. If for some reason Intel like crashed on me, would I hate taking shares of Intel? No, not really. I'll I'll take the shares, I'll buy the shares, sell some cover calls, I'll run the wheel if I need to. It's a real company. Plus, the government has a stake in it. Long term, you kind of have to be bullish in the uh government portfolio stock. So anything that you know the government is bagging, I feel pretty comfortable owning. Oddly enough, SCHD, despite the market being weak, this ETF up 38 cents. That's a big move in this thing. This is a low volatility kind of ETF, the Schwab dividend ETF. It holds a hundred or so uh high dividend paying stocks. That's a big move in this thing. That's helping my PL on the day because well, you saw it took a little bit of a loss on TQQQ, and then some of these other positions are starting to turn around. Around on me, but having those shares and because this thing tends to often move independently of where the rest of the market is moving. You see, that helps smooth things out a little bit by having those shares. Silver having a day, which I needed it. 100 shares. That's good for my 100 shares. Obviously, we're up a dollar 65, 3% upday in silver. That's a big up day. Also helping this short put that when I was down like $800, $900 on. Now we're starting to claw back on that. I did add a couple of short calls the other day. I'm going to show a negative PL on that. I don't care about losing on the calls. I'm more than going to make up for it on the up moves on the short put plus the hundred shares. So the calls, I'm going to keep them as a smallish kind of hedge. And one call I could consider a covered call because I got the shares. The other call, I'll just say it's married to the put to form a strangle. If I have to just start you know rolling it and defending it, you know, I can roll one call and one put out to the next month at some point if I need to, you know, keep the dream alive on the strangle. Then I had a put butterfly as a hedge, a downside hedge for this week. If we had had any kind of down move today, I probably would have got paid on this. Instead, we've got a pretty good up move. I'm not concerned about the up move. This is a small hedge. I'm glad I lost on it because I make more money on the up move because it's a bullish position. Overall, I'm very bullish here with the hundred shares plus the very deep in the money short put. So, yeah, I wouldn't have mind uh making a little money on the hedge had we got like a two-dollar drop in silver today. Probably would have made 100-200 bucks, which would have helped offset some losses. But ideally, yeah, I want silver to go up every day from here, especially with what I've currently got on. SpaceX up 29 cents. So, yeah, with you know the weakness of the market. This is holding up a little bit today, trading at $158 a share. Got a foot credit spread. The short put's $170, so I'm in the money. I'm $12 in the money on the short put here, which isn't great, but I've got 50 days to wait it out. Uh XLF, the financial sector ETF, up 64 cents today. That's a good move. Had a good move yesterday. I've got some long calls that expire 78 days from now. Not my typical trade buying uh calls. I bought some at the money calls on XLF uh two weeks ago, just because I thought the financial sector could start moving a little bit. And the last couple of days it really has. But really, when you zoom out, you know, we had a good run here, and that's when I bought my calls, and then it's traded sideways. I'm like, damn, maybe I made a mistake buying those calls, but now it's starting to it looks like it's about to make another jog up, which would be great. I could make, you know, two bucks, three bucks, four bucks on this trade, I'd be happy. I paid 190 per call here, so 380 bucks for the two calls. Yeah, if I could at least make 380 bucks, right? Make it that uh I'd be happy and I'd probably take that profit and move on. XSP, lots of butterflies. This put butterfly expires today. It's gonna be a 33 cent winner. Not much of a winner, but it's a broken wing put butterfly, meaning when the market goes up, I don't make much. I just get a little bit of credit when I put these on. Remember, I force it to make a credit. 34 cent credit is what I'll get. And the reason is I don't want to lose to the upside. But remember, this is really kind of a bearish play. If the market moves down, I can make six, seven hundred dollars on this butterfly. So, you know, it's one of those things I don't mind the market going up because I can't get hurt. But I'll I really if the market goes down, this is more of a hedge against all my bullish positions because these bearish put butterflies will profit. But this one I'll expire today. I'll get my 34 cents. Then I've got a put butterfly for next week for next Friday, and then I've got a put butterfly for two Fridays after that, and then I put on one this morning with my Discord members, another put butterfly for three Fridays from now, because I always put these on on Friday for 21 DTE. Well, there's no trading tomorrow, so there's no Friday, no 21 DTE. So I had to put it on one day early. So I put it on today for 22 DTE. That's three Fridays from now. That's the trade. I also have two call butterflies. One for two weeks from now, one for one week from now, or excuse me, one two weeks from now, and then one I put on this morning with my Discord members because these also every Friday at 21 DTE. We did it today for three weeks. 22 DTE. You'll notice I have put butterflies expiring today, but no call butterflies. They already came off. I took a call butterfly off uh uh early for a win. Um so yeah, I've got four put butterflies and two call butterflies. One of the put butterflies expires today, so I'll have three put butterflies and two call butterflies on going into next week. Yeah, anything from you guys, questions, comments, anything from the chat before we call it a day. Really call it a week, right? Weird ending the week on a Thursday. Uh yeah, uh speckled dust. What strikes do you typically do on your MES trade? So the put ratio spreads, I like going 90 DTE, whatever expiration is closest to 90 DTE, and I like selling the 10 delta puts. And then to form the ratio spread, just make the ratio as wide as you want, the debit spread. I can put one on as an example. Matter of fact, I just use the one I did yesterday because it's still the same strikes. As far as the same deltas, the market hasn't really moved enough. It would be the same trade if I was putting it on today. So I go to the 10 deltas, typically, you sell that, and just sell it one time, and then how wide do you want to put debit spread? In MES, I like about 200 points. I think it's not too big, so it doesn't cost you too much money, but you don't want it really tiny either, because then it doesn't really protect you in a down move. So you want a big profit area, so 200 points seems like a good middle ground. So if I uh sell the 10 delta put and then buy the put uh 200 points above, this forms a 200-point wide put debit spread. Now remember, futures are not like stocks and ETFs. The multiplier is not 100 the way it is in stocks and ETFs. Every futures product has its own multiplier. In ES, the big future, the multiplier is 50. In MES, it's one tenth the size, the multiplier is five. So a 200-point wide uh spread here is not a $2 uh00 widespread the way it would be in stocks because you'd multiply it by 100. Um so this is really more of like a uh five times two hundred, it's a thousand, yeah, thousand dollar widespread is what it'll be. So it's gonna add an extra thousand dollars of profit potential once I form the ratio, if that makes sense. Then go back here and then double up the short. This will be a two by one put ratio spread. I'm gonna get a around a thirty-two dollar credit times five in the MES. So I get a hundred and sixty dollars credit. But remember, I've got an extra thousand dollars of profit potential because of the debit spread. So I get a uh 160 credit up here. That's the small profit area, but if I get a drop inside the ratio spread itself and pin the two short strikes at expiration, I potentially could make an extra thousand. So my max profit's eleven sixty. I hope all that made sense. I've done videos about these ratio spreads before, though. Go check those out and do a search for put ratio spreads on the channel. I bet you'll find some videos. But here's what this particular ratio spread would look like. Let me actually turn off the existing trade. This is what the example trade looks like. So $32 credit times five, and get a 160 credit. So the market goes up for the next 90 days, which is very likely, right? The positive drift of the market, right? So it goes up, I'm gonna get $160. If it goes sideways or even goes down a little, I'm gonna get $160. Even if it goes down a lot, you're gonna get $160 in expression. Now, if the market drops more than $800 points, well, you start getting inside this higher profit area because of the debit spread. And you have that extra $1,000 of profit potential. You typically don't want this, right? Because it could be kind of scary because you're gonna take some heat on the one naked short put versus the put debit spread. You don't want this to happen early. Ideally, you'd like that this to happen very late in the option cycle. So if you put this on at 90 DTE, you wouldn't want the market to drop down here in the next week. That's gonna be bad. You're gonna be down some some money, maybe a couple thousand. I I don't know. It'll be ugly, though. I could actually turn on the theoretical line. What's the theoretical line say? If the market dropped 800 points tomorrow, we'd be down 140. If it dropped down here below our shorts, we'd be down. That's kind of laggy here, but maybe $500. Now that's conservative, because realistically, if the market drops that low, volatility is going to spike. So I would say those numbers are probably going to be twice that big, maybe three times that big. You could be down more than a thousand dollars uh tomorrow if the market dropped down here. So it's not you don't want that early in the trade, but you don't mind a slow grind down over the next 90 days into this profit area. Think of this put ratio spread kind of like a butterfly. It's exactly like a butterfly. We just didn't pay for the extra long wing because puts are expensive. We'll pay for the first put. We're not going to pay for the other put. But by not paying for the additional put to the downside, you have unlimited risk to the downside on the one naked short put. Pop on this trade, though, 97%. It's a very high probability trade. If you manage at 50% profit, meaning uh if I get a 160 credit, I'll manage at 80 cents. Once I get to 80 cents, I'll take it off. The pop on the trade is probably 98-99%. Very high probability trade. Not saying that it's a trade without risk. You know, things can happen, market crashes can happen. You know, again, you know, don't put on a million of them.

SPEAKER_01 32:25

Remember, MES is half the size of SPY. Yeah, yeah, yeah.

SPEAKER_00 32:34

I would get out at 50%, especially if you're new to how these trades work. Now, because ratio spreads, you don't mind the market coming back against you because your max profit area is to the downside. Like if the market creeps up and you very quickly get to 50% profit, if you're like, well, I I don't mind holding now because now if the market crashes in a big way, it'll just get me closer to where I really want to make my max profit. Um, there's certainly nothing again, nothing wrong if you just want to let it go. If you just want to let it go to expiration and see what happens, if you're comfortable with that risk, yeah, that's where you're gonna make most of the money on that trade. Because most of the money on that trade happens inside that big profit tent and it happens at expiration because you can't, you're not gonna make the most money unless you're in the tent at expiration. Being in the tent early does nothing for you. So if you want to take more risk for a potential more profit, you certainly can let it go all the way to expiration. If you want to take some risk off the table, yeah, once you get to 50% profit, yeah, get out, get out. And when I say 50% profit, I mean 50% of the credit on the trade. Not 50% of max profit. You mean that's a huge number, and you're almost never going to get that. The only way to get that is to let it go to expiration and see what happens. All right, guys. Well, that is it for this week's market outlook. Hope you guys had a lovely week of trading right now. The ES unchanged on the day. The Russell is down half a percent, the Nasdaq down 1.1% on the day. Yeah, other than that, I'm gonna go ahead and get out of here. I've kind of flattened out some of my positions as far as some risk, took off some you know, ratio spreads in MES that were not necessarily risky trades, took off the TQQQ shares. I'll get back into them next week if I feel like I the market wants to go up. Of course, ideally, since I got out of those shares today, I wouldn't mind a down day so I could buy back in at a lower cost. Now that's the great thing. And one of the things you always want to do with your trading is be set up so that whether the next day is an update or a down day, that you've got things working for you. You've got positions working for you, or you potentially have new positions that you're prepared to take, regardless of what the market does. All right, guys, I'll be back on Monday. Peace.