The stock market can be like a roller coaster with modest climbs and steep drops! Today was a great example of that because the market has been dropping over the last few days, but when the Federal Reserve Chairman, Jerome Powell said there will be increased inflation upon recovery, stocks tumbled quickly. The market can rise or fall for many reasons, but impactful news can be a culprit too. Government reports on how the economy is going is another way to move markets. Usually, the jobs report would be a great way to move the market and I believe stock would have been boosted because the United States added over 379k new jobs in February.
I fared very poorly over the past week and I even tried to be strategic! I bought call options in $LAC or Lithium Americas Corp with a decent strike price of 15 dollars which was way below the price when the market opened yesterday. Although, today with the news of inflation my options loss really fast and did not recover. $LAC started the week hovering close to 20 dollars a share then slide one point to almost 13 dollars a share! That’s some pretty extreme volatility. $LAC is a solid lithium mining company that has mines in Nevada and that’s why I felt some attachment to the company. I know the stock will rebound, but it hurts to see a bunch of unrealized losses.
Ironically, I ordered a put option for $AMC the theater company that has been mostly closed due the pandemic. AMC has been in the news a lot recently because it became a meme stock for the redditors to try and take to the moon. Most people know that AMC is not profitable right now and has been bleeding cash because of their unused properties. The put options has a strike price at $8 and AMC literally has been hovering close to that for weeks! My theory is that people are still excited by this stock and are holding on to incase it make reach some unrealistic gains in the foreseeable future. I have a expiration date on my option as of March 19th. I’m hoping there is a massive sell off of this particular stock and I come out ahead! It’s not looking too good so far. How will you predict the market will go into the next week? Please leave a comment in the box below!
$LAC Chart – 03/05/21