27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.
In spite of United States Steel Corporation (NYSE:X)'s positive earnings report Tuesday, the markets saw unusual weakness across the industry Wednesday, from AK Steel Holding Corporation (NYSE:AKS) to Steel Dynamics, Inc. (NASDAQ:STLD).
Gordon Johnson, managing director of Axiom Capital Management, attributed the phenomenon to President Donald Trump’s Tuesday announcement delaying the imposition of steel import tariffs.
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“The Section 232 was everything,” Johnson told Benzinga in an email, noting that all of his clients had been long steel because of it. “I don’t care what people tell you, the thought was it was going to get passed at yesterday’s Trump rally in Youngstown, OH.”
But, as he had previously warned, it didn’t pass.
“I can't believe folks were so nice on USS' call,” he added. “This is a disaster of an announcement for the steel mills by Trump.”
Considering flat-to-weak demand, high output and the fact that “auto sucks,” he expects steel prices to continue lower.
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What The Steel Players Say
Johnson believed U.S. steel mills had been pumping steel prices on the prospect of the 232’s passage. Following the announced delay, he consulted multiple industry players on the implications. The overall sentiment was the market could soften following the news.
One industry source highlighted a market participant who resumed purchasing of Korean hot rolled coil recently. The source pointed out to Johnson the fact that "traders are still using 232 clauses" and that "the fear factor is gone."
Related Links:
A Long-Time US Steel Bear Is Impressed With New CEO, But Not With Stock
Can A New CEO Put The Strength Back In US Steel?
27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.