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The S&P500 MTI remains strong green and the equal weight is mild green but about to firm up on that massive "everything else" breakout.
Market Musings
Wow, did you see what happened since my last newsletter? I wrote this to you on Wednesday:
"If tomorrow's CPI inflation number comes in lower than expected and breaks this chart down, we could start to see a stronger broadening of stocks, with Mag7 taking a breather."
Thursday was a banger as this played out exactly as mentioned with Mag stocks getting crushed while broader market stocks had a phenomenal day.
Friday brought a slightly strong PPI number but it didn't matter - the sea change that I mentioned was ON. When the Pamplonian bulls start running it's hard to stop them. Mag slid further and we saw continued follow-through in laggard and small cap stocks.
Everything interest-rate sensitive went bananas, but it was really an everything-rally with bitcoin miners, payment processors, home builders and home improvement, solar, banking, coffee, beauty products and retail. Even what I would call "safer tech" did well: ride share, cybersecurity (crooks ain't going away). Guess what trades we're up on? All of those.
The real-economy stock market responded as the prospect of lower rates bodes well for consumers who need a boost of confidence (University of Michigan sentiment at 8 month lows). Lower rates are huge for stocks, as long as it's about falling inflation and bringing down real rates (rate levels over inflation). If the Fed can engineer a mere softening in the econony versus a harder landing... well this could be another Roaring 20s in the making. Could be. All eyes will be on economic data from here on in.
What did we do in the community this week before that Mag7 selloff? I kid you not, we hedged our tech big time and covered short puts in names like AMZN (all trades posted in the CFI Discord community).
And then added trades in HD, DHI, KRE, to already great ones in ULTA, SBUX, DDOG, DOCU and INTC. Yup, out of the wrong places before the drop and into the right ones. It doesn't always happen that perfectly but hey we'll take it.
We are killing it in the CFI Discord community with incredible insight, education and trades. I feel uncomfortable mentioning these trades because I don't like sensational emails like this. But I had to say something because the value in the CFI program keeps soaring...
Yesterday alone: TSLA put sale: up 37% in two hours, (after capturing 66% on a trade last week).
Closed DHI and HD in one day for 39% and 36%.
META massive covered call hedge up 50% in 3 days (yes we hedge too)
AMZN cash-secured put up 64% in a week
And a bunch of open positions sitting on nice profits: DOCU long calls up 19%, INTC long calls up 15%, KRE long calls up 5%, AAPL covered calls up 3.5%, ULTA up 7.3%, and XLE (energy) put-sale up 55%.
Many other positions up money: CLSK put sale, UBER, DG, DIS, VST, SBUX put sale. Our only loser was ABNB which we closed for a small loss that is utterly dwarfed by the wins. The key is we follow the rules and guardrails. Remember: work smarter, not harder. But we do both so that helps...
But notice something about those trades? Not just tech and semiconductors. It's an extrememely broad basket of themes - because there are great trades to be made all over the place, and concentrating on the 5 stocks that everyone else is trading cpuld be dangerous. Our job is to do better.
This is just an amazing community with charting, economic news and calendars, scanners that you can copy and set up. I pay for great services and tools that are available to you as a member, forever. There's something for everyone in there and you could be part of it too with a lifetime membership by enrolling in the Cash Flow Insiders Program (incredible coupon below in this newsletter).
And the July23 program is the LAST time I will be throwing in my Gamma Options Trading Mastery 16 hour video course for free. This is listed at $797 and students have raved about it. Included. Plus an hour of one-on-one with me to go over the concepts. In the end you get 6 weeks of live mentoring for a few hundred bucks when you back out all the extras (!).
And when you've completed the 6 week premium-crushing program you'll continue thriving in the Discord (you get into the Discord right away when you sign up though!). You'll keep learning from me and the other incredible contributors.
Think of it as an amazing ecosystem of support to give both long-term investors and shorter-term traders the support they need to excel (yes I also look at quality long term holdings - I can't help it - I managed hundreds of $millions in listed ETFs that focused on long stocks+options edge) . In the community I host a once a week live Q&A/education meeting to continue to talk about the CFI concepts, markets, rules, trades and more. You'll never stop learning. Code 50off at checkout... but read on for Pro Tips (BTW I made tens of millions as a pro options market maker for 12 years and pro options fund manager for 13 - $1 Billion managed).
Pro Tips
People have been asking me about my META in-the-money covered call trade from this week. It's about using the levers available to us to create effective hedges that ALSO generate options income.
Adjusting the delta on our call sales allows us to do something amazing: convert our long position into more of a cash-secured put sale. This has to do with synthetics, which I teach in the program, but you don't have to worry about the geeky explanations beneath the surface, you just have to learn how to do it.
For example, when you're long a stock and you feel it is topping-out based on perhaps a trendline, target reached or other edge, you adjust your call sale delta higher to reflect a hedge that makes sense for that stock. If the stock keeps going? You crush a little premium for option cash flow. If it comes down you actually get a decent hedge for a change.
We killed it on this hedge at exactly the right time, protecting $18 of META's drop, which we covered Friday morning in the Discord chat. We even re-hooked a new call sale for extra call income on the intra-day bounce.
Again, play with delta - it's one of the great levers at your disposal. And it's one of the many tools we use in the CFI system.
Next program starts July 23. It will change the way you approach trading, I promise.
Hope to see you on the Inside. See below for a SPECIAL OFFER.
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The Cash Flow Insiders Live 6 week mentoring program for learning to crush premium but also targeting upside. I'm Hans and I've managed almost $1 billion dollars in these kinds of strategies, having generated over $750 million in options cash flow for investors around the world.
It's perfect for complete beginners because it includes a full beginner options boot camp AND my $797 Gamma Options Mastery video course thrown in - which aims to teach how to go from a beginner to pro trader!
As a newsletter reader you'll get 50% off Sale with coupon 50off at checkout, or email us to have a Paypal invoice sent to you.
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