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1 Predictable Pricing Behavior That Savvy Options Traders Use

1 Predictable Pricing Behavior That Savvy Options Traders Use

Posted On January 8, 2019 2:37 pm
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Earnings season officially kicks off next week with some of the big banks such as  JP Morgan (JPM)  and Bank America (BAC)  set to report on Tuesday and the first of FAANG, Netflix (NFLX) reports on Thursday.

Earnings can be very tricky to trade as there are many moving and unknown parts; will the company miss or beat expectations, what will be the guidance, will traders ‘sell the news’ in profit-taking and will the recent overall market volatility override the results?

But there is one predictable pricing behavior that savvy options traders use to produce steady profits…

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About author

Steve Smith
Steve Smith

Steve Smith have been involved in all facets of the investment industry in a variety of roles ranging from speculator, educator, manager and advisor. This has taken him from the trading floors of Chicago to hedge funds on Wall Street to the world online. From 1987 to 1996, he served as a market maker at the Chicago Board of Options Exchange (CBOE) and Chicago Board of Trade (CBOT). From 1997 to 2007, he was a Senior Columnist and Managing Editor for TheStreet.com, handling their Option Alert and Short Report newsletters. The Option Alert was awarded the MIN “best business newsletter” in 2006. From 2009 to 2013, Smith was a Senior Columnist and Managing Editor for Minyanville’s OptionSmith newsletter, as well as a Risk Manager Consultant for New Vernon Capital LLC. Smith acted as an advisor to build models and option strategies to reduce portfolio exposure and enhance returns for the four main funds. Since 2015, he has worked for Adam Mesh Trading Group. There, he has managed Options360 and Earning 360, been co-leader of Option Academy, and contributed to The Option Specialist website.

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