Good morning, traders…
Jeff here.
There’s an itch that traders feel — this need to always be in the game, always making a move.
But as weird as this might sound, some of the best trades you’ll ever make are the ones you don’t take.
That’s exactly where I stand right now.
Markets are ultra-volatile, and last week’s big tech earnings were a perfect example of why patience pays off.
Many traders rushed in, buying call options ahead of earnings, thinking they were about to hit the jackpot. After all, these companies were expected to beat expectations — and they did!
But look at what happened next: the stocks tanked. AMZN, GOOGL, MSFT — all red.
In hindsight, it’s obvious. The outcome of these events wasn’t just about whether they “beat” the top and bottom lines. It was about guidance, CapEx, and market sentiment.
Traders who placed their bets before earnings were essentially gambling. They didn’t wait for the full story. And a lot of them got destroyed.
That’s why I prefer to wait until after a major event plays out before making my move.
Some traders don’t have the patience for this. They want action. They want to feel like they’re doing something.
But every day isn’t a great trading day. And the traders who don’t respect that end up taking losses they could’ve easily avoided.
With that in mind, let me show you why now is a time for caution, conservatism, and patience…
Avoid ‘Sports Betting’ on the Stock Market
Traders love to be right. It’s a natural instinct — this internal need to make a bold call and have it pay off big.
But the best traders in the world don’t care about being right all the time.
They prioritize making money over being right. It doesn’t matter if you “nailed the call” on an event — if you didn’t make money, it was a waste of time.
On the flip side, if you placed a predictive trade and were wrong — now you’re stuck with a loss simply because you wanted to make a brilliant prediction.
This is why I don’t make binary bets before major catalysts like earnings reports, Fed meetings, investor conferences, or product launches.
The outcome is unknown. And when the outcome is unknown, the trade is a gamble.
So, what do I do instead? I wait.
Once the catalyst happens and the initial reaction plays out, that’s when I look for my trade.
This is why:
- The major move has already happened. Now I can see what’s real and what’s just noise.
- Knee-jerk reactions often reverse. I wait for confirmation before making a move.
- Implied volatility (IV) drops after the event, making options cheaper.
Instead of betting before the catalyst and hoping for the best, I wait after and trade with the trend. That’s a strategy that actually works.
3 Mistakes That Lead to Bad Predictive Trades
If making predictive trades is so risky, why do so many traders still do it?
It usually boils down to one of these three mistakes…
1. Constantly Chasing Action
Some traders think they have to trade every day. Maybe they get bored. Maybe they feel like they’re missing out. Maybe they’re just impatient.
Whatever the reason, it leads to bad trades.
The best traders don’t make trades just to trade. They wait for the right setups. They pick their spots carefully.
If you feel the urge to trade for the sake of trading — stop. That’s not trading. That’s chasing.
2. Greedy Positioning
Here’s a fact: if you buy options before a major catalyst and you’re right about the direction, you’ll make more money than if you wait until after the move happens.
That’s true. But that doesn’t mean it’s a good strategy.
The problem? The odds aren’t in your favor. The market could move the opposite way. Or the expected move could already be priced in, leading to a muted reaction. Or implied volatility could crush your contracts even if you’re “right.”
Being right doesn’t mean you’ll profit. And that’s why greed leads to bad trades.
3. Copying Other Traders’ Plays
During major catalysts, social media explodes with traders sharing their bets. Everyone has an opinion, and they’re all trying to convince others that their trade is the best one.
But blindly copying trades is a terrible idea.
You don’t know their full strategy. You don’t know their risk tolerance. And if too many people pile into the same trade, it becomes overcrowded—setting up the perfect conditions for a rug pull.
Trust your own research. If you don’t understand a trade inside and out, don’t take it.
Some traders made a killing on last week’s big tech earnings. But a lot of traders got crushed because they didn’t wait for the full picture before making their move.
This is the difference between smart trading and gambling.
If you don’t know how the market will react to an event, why are you betting on it?
Let the market show its hand first. Then trade the reaction.
Trade smart,
Jeff Zananiri
P.S. One strategy is still working, even in this crazy market…
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*Past performance does not indicate future results