Predictions for Friday, March 11th 2022

NOTE: If you wish to get our updates immediately on Wednesday as the market opens, make sure to fill out the prediction survey on Tuesday (and, if you haven’t already, leave your email WITHIN THE APP - click on the link to see how). We reward our participants with early indications of where the market will end up. Everyone else gets the results a day and a half later.

Thanks for following us, feel free to share to your friends:

Our weekly predictions are here, available exclusively to our subscribers (competition participants get it a day and a half earlier if they leave their email), for Friday, March 11th 2022 (4pm EST; at market close). Keep in mind that our accuracy is much better for low volatility assets, so interpret the predictions with caution. For an overview of our accuracy thus far, see here.

Our estimate for the Friday close for our 5 major indicators and 2 stocks this week is the following:

It’s all going down this week, continuing a bearish trend. Note one important change. The last row is a prediction of direction with respect to Wednesday’s highs instead of Tuesday’s lows. This was done in order to emphasize that we expect the markets to end up lower than yesterday, but close to their values of Tuesday’s lows. Why? Because of the impact on our options strategy, where we bought puts and downward-facing iron condors. Keep in mind that we get the new CPI inflation report today, and the latest price pressures on oil and gas will likely exacerbate those numbers.

On the other hand, expectations over the Fed hike have anchored strongly around a 25bps increase (the 50bps is off the table for next week’s meeting). All of this is likely to negatively affect market movements this week, and probably next week as well, thus continuing the bear market.

In terms of the options strategy, we sold 10 412/413 to 429/430 SPY 11/03 contracts (the iron condor), and got an immediate $550 return (10 contracts * 0.55 price * 100 shares). If we fall outside the condor, we lose $450 (there is a 30% stop-loss in place to limit this to $135).

We also bought 2 SPY 11/03 puts for $1050 ($5.25 for each), acting as a hedge in case SPY breaks the lower boundary, but also as a convenient strategy to counter Wednesday’s highs. The standard stop-loss order is also at 30%.

Finally, we got the AAPL iron condor as well, selling 10 contracts of 150/152.5 to 167/167.5 AAPL 11/03 for $420 immediate gain.

Our expected gain is around $1500 to $1700 if we hit the target, and about $1000 if SPY overshoots but AAPL doesn’t. The losses are limited to $670 ($315 from SPY call + $135 from iron condor + $220 from AAPL).

DISCLAIMER: This prediction survey is still in its testing phase. Neither the survey nor its results act as investment advice of any kind, nor should they be considered as such. The results of the survey need not correspond to actual market preferences or trends, so they should be interpreted with caution. Oraclum bears no responsibility for your investment choices based on these predictions.

Keep following us on Twitter to stay informed about the weekly survey each Tuesday.