>>>We’ll focus on staying sharp in this market, do some live trading and walk through what we’re seeing in real time, discuss the best ways to preserve capital when it feels like we’re walking on eggshells — and it’s going down at 1:30 PM ET for Stonkamania!<<<
You want to know why you keep losing money even when your read on the stock is dead-on?
It’s not your analysis. It’s not your timing. It’s the bid-ask spread in current conditions that’s bleeding you dry before you even get a chance to trade.
I’m talking about something I witnessed recently that made my blood boil — and if you’re trading options in this low-volatility environment with the VIX still under 17, you need to hear this.
I pulled up Bristol-Myers (BMY) and tried to get into a position. The moment after I went to buy at 85 cents, the market makers instantly spread the bid-ask out 15 cents.
Here’s the kicker: If I had immediately turned around and sold those same options, I would’ve taken an instant loss of about $3 per contract — that’s a 4.7% haircut for doing absolutely nothing.
The stock hadn’t moved. The market hadn’t changed. I just got taxed by the market makers for daring to participate.
Why Market Makers Are Getting Away With Murder
When the VIX collapses to these extreme lows, market makers know you’ve got no edge. So they widen the spreads like they’re running a highway robbery operation — and it’s completely legal.
Think about it: On a $10,000 trade, you’re losing $1,000 just by entering the position. You haven’t even had a chance to be right or wrong yet.
I watched Bristol-Myers hit the high of the day — new high — and my options were actually DOWN in value.
How does that happen? Volatility collapse.
Even as the stock made new highs, implied volatility was draining out of the options, killing the premium.
This is the part that makes me want to flip a table: These market makers are legally robbing us blind and there’s no punishment for them because they’re just “providing liquidity.”
The Only Way to Survive This Environment
So what do you do when the game is rigged?
You stick to penny-wide options in mega-cap stocks — Apple, Microsoft, Tesla — the names that trade tens of millions of shares a day. Those are the only ones where you can get fair pricing without getting scalped on entry.
But here’s the problem: Those are the stocks that aren’t moving. The real action is in names moving 20% in a day, but the spreads are so wide on some of them that you can’t get in without massive slippage.
It’s a brutal reality, and I’m not here to sugarcoat it. When you’re operating in a low-volatility environment like this, you’ve got to be surgical with your entries.
Don’t chase the high of the day. Don’t panic-buy into momentum. And for the love of all that’s holy, check the bid-ask spread before you hit that buy button.
The market makers are counting on you not paying attention. Don’t give them the satisfaction.
Order Flow:
This is for informational and educational purposes only. These are not official alerts issued by Lance, but rather some interesting orders picked by the team at Lance Ippolito Trading.
When you look at these plays, always take the market maker move into consideration.
You can be right on the direction but still lose money if the stock doesn’t move enough. That’s where the market maker move comes in clutch.
With puts, they’re often downside hedges in case a stock tanks, especially around earnings. The further out of the money they are, the more likely they are to be hedges.
Also be sure and check when the company’s earnings date is because many of the plays we post here are centered around earnings!
If a stock is really expensive, consider a spread to lower the cost.
And finally, always remember the golden rule when it comes to buying calls: Buy dips, sell rips — and don’t chase!
If a stock’s moved a ton already today, maybe wait for a pullback.
There is inherent risk in trading. Trade at your own risk.
Note: If no date is listed after the month, it’s the monthly expiration (third Friday).
The team at Lance Ippolito Trading
Lance doesn’t want the CCP spying on him, so you’ll never find him on TikTok. Same goes for other social media sites, which are filled with impersonators, scammers and crypto bros.
You can only find him on his personal YouTube Channel — smash that Subscribe button! https://www.youtube.com/@LanceIppolito
And in his private Telegram channel: https://t.me/+-gVwEIwGJhplMTgx
Important Note: No one from The TradingPub team or any of its associated brands will ever contact you directly on Telegram.
*This is for informational and educational purposes only. There is inherent risk in trading, so trade at your own risk.
P.S. I Know of Only ONE Setup That Didn’t Record a Single Loss Last Month
My powerful daily trade was perfect in September…
Cruising through with 0 losses.
There’s no better way to kick off the new month (and quarter) than with a setup that’s already proven how powerful it is.
