Diving Into ‘Deep End’ For Selective Opportunity


Simpler Trading Team

May 27th 2021  .  3 min read

Is all this market chop the enemy of traders?

The mind-numbing, continued volatility of recent months seems a daunting foe, but active traders are taking it in stride and capitalizing on opportunities.

We understand just how the chop and uncertainty is undermining expectations that the market will hold in one direction before suddenly shifting… again. Fast spikes and short rallies are challenging when taking time to plan and execute trades with confidence.

Simpler’s traders know the importance of not letting cries of, “Oh, my, volatility,” lead to unnecessary stress, rushed decisions, and losses.

Traders who learn to use volatility to their advantage can open up a new view of creating steady income. This can lead to consistency even in the wildest phases of the market, which active traders will always face.

Think of trading in volatility like learning to swim in the deep end of a swimming pool. Scary thought for most people looking to expand their aquatic skills. Yet, once a swimmer learns to navigate the deep end of the pool, they no longer run away – they look forward to the challenge and their expanded opportunity.

During any market chop fest, the default plan is to dive into the charts of targeted assets to discern patterns, setups, and ongoing opportunities. Some days (maybe even weeks) remaining flat in cash is the plan while practicing patience for the market to open up solid opportunities.

Cries of inflation, stimulus infusion, politics, world economics, or the pandemic are the obstacles of those not willing to take a chance on the “deep end” and discover a new path forward.

The market has hinted at “cracks in the ice” for setting up a stronger, sustained direction. Nothing is for certain, but expectations are for major indexes to keep moving higher.

Simpler’s traders continue to keep their eyes open for opportunistic setups while being selective in what assets they follow. While bullish is the sentiment, a strong pullback could open up wallets for more buying.

If it’s not your style to belly-flop off the diving board into the deep end of the pool, try wading in from the shallows one step at a time. And, it’s OK to chill out while soaking in the action from the edge of the pool.

We Saw: Market chop continues with hint of upside –

  • Increased concerns over rising gas prices
  • Airlines booking seats at pre-pandemic levels
  • Big box retailers sharing marketing, brands

We’re Watching: For an extended rally to deliver setups –

  • Targeted tickers to put money to work
  • Pacing ourselves to maximize profits
  • Setups in: ABNB, SPX, LMND, FCX, NVDA, SNOW