Hey Traders,
The market’s sending mixed signals right now.
On the surface, things look bullish. The S&P 500 is sitting above all three of my key trend points — short, intermediate, and long-term. We’re even tipping out to new highs.
But here’s the catch: it doesn’t feel as strong as it should.
A Market That Looks Bullish… But Feels Weak
Take the Dow (DIA). It’s technically bullish, but it’s also flatlining.
That usually means one of two things:
- We’re about to rip higher in a hurry, or
- We’ll drift down in a slow fade.
Then look at the Nasdaq (QQQ). It’s also bullish overall, but it’s broken support a couple times and isn’t showing the clean strength you’d expect.
So two out of three major indexes are bullish — but not with the conviction you’d hope for, especially with interest rate cuts coming down the pipe.
How I Trade a Market Like This
When the indexes are fuzzy, I don’t guess.
Instead, I focus on individual stocks that are in great trends — names like Corning (GLW).
If a stock is in a strong, steady uptrend, it doesn’t matter if the broad market is choppy.
I can run my income trades with much higher confidence: covered calls, naked puts, credit spreads.
Why the Stock Comes First
Options yields are super high right now, which is great for income strategies.
But here’s the thing — high yields alone don’t make a trade.
The stock’s trend is what makes or breaks it. That’s why I only sell options on names that are already trending higher. From there, I can:
- Buy the stock and sell covered calls,
- Skip the stock and run credit spreads, or
- Sell naked puts and collect premium up front.
All of those can work — but only if the stock itself has momentum.
Bottom Line
Income trading is one of the best plays in this environment. Premiums are rich, and the strategies are simple.
But never forget — the most important part is the stock.
Pair income strategies with a solid uptrend, and you’ve got the best of both worlds: steady cash flow and higher odds of success.
Trade well,
Jack Carter
P.S. Should you buy AAPL ahead of September 9? Here’s my answer…
