DailyPlay – Partial Closing Trade (QQQ) – June 27, 2023

Partial Closing Trade

• QQQ – 66.29% Gain: Sell to Close 2 Contracts (or 2/3 of your Contracts) July 3rd $365 Puts @ $7.35 Credit. DailyPlay Portfolio: By Closing 2 of the 3 Contracts, we will receive $1,470.

Investment Rationale

Yesterday we saw a sizable shift in the bond market’s expectations of Fed policy for the rest of 2023. Bond swaps are now only pricing in 1 rate cut for the rest of 2023, shifting from the 2 cuts expected last week. Despite this there remains a large gap between the bond markets and what the Fed has continued to communicate with 2 more rate hikes expected this year. The 1.4% decline in the Nasdaq-100 yesterday reflects this change in sentiment as tech leads the selloff and the Equal Weight S&P 500 gains nearly 0.6%. This improves the market breadth marginally but remains challenging for equities overall. We are taking this opportunity to take partial profits on our QQQ portfolio hedge, and close 2 out of 3 contracts. We are also watching our ORCL position closely as it is around our 50% stop loss threshold and may close during this week’s trading session.

QQQ – Daily