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When the S&P 500 broke above old highs, I would've loved an extended rally… but the Money Calendar doesn't lie: I knew we weren't going to get one.
And sure enough, stocks have been about as still and heavy as the hot, humid air around here. It wasn't the heat that made volatility collapse in the overall market, but seasonality.
Now, barring the "V3 Effect," which can pop up like a "Blue Light Special" and generate profit potential in any stock, it's always quiet around huge swathes of the market in the summer. Investors (especially big ones with lots of cash to splash around) take vacations, and that dampens down the action.
But if you know what corners of the market to peek into, you can and will find some seriously profitable volatility. Volatility's nothing to be afraid of; stocks have to move – up and down – to make your trades really profitable.
About the Author
Tom Gentile, options trading specialist for Money Map Press, is widely known as America's No. 1 Pattern Trader thanks to his nearly 30 years of experience spotting lucrative patterns in options trading. Tom has taught over 300,000 traders his option trading secrets in a variety of settings, including seminars and workshops. He's also a bestselling author of eight books and training courses.