Happy Monday, traders…
It’s official: the Nasdaq is in a bear market. The index is down more than 20% from its February 19 highs:
One year of gains erased in a month. That means fear.
And when fear enters the market, many traders freeze. They don’t know what to do, so they do nothing.
Panic creeps into the headlines, the selling picks up, and next thing you know, everyone’s talking about historic market crashes.
But while some traders are stuck staring at their screens — feeling like a deer caught in the headlights — others are licking their chops at the potential opportunities.
Volatility is a gift for disciplined options traders.
The stretch of low volatility we’ve had over the last couple of years has conditioned market participants to only think in one direction.
“Buy the dip” became the default setting. And that worked well — until it didn’t.
But now, we’re in a completely different environment…
The CNN Fear & Greed Index is in “EXTREME FEAR” territory. Meanwhile, the CBOE Volatility Index (VIX) crossed the $40 mark last week — two flashing red warning signs.
You need to understand this: Nervous markets can be extremely profitable markets … if you know how to trade them.
With that in mind, let me show you how volatility can lead to some of the best options-trading opportunities…
Why This Market is Perfect for Options Trading
Fear shows up when traders aren’t sure what comes next. And there’s no shortage of uncertainty this year — new tariff policy, Fed meetings, political headlines galore — it’s a recipe for nervous energy.
When fear spreads, traders tend to stop thinking logically and start acting emotionally.
That emotional behavior creates volatility. Big down days get followed by quick reversals. Traders overreact in both directions.
But if you follow your rules and have a plan, that volatility isn’t something to fear — it’s something to use.
Big price swings mean bigger trading ranges — and that’s the key ingredient for options gains.
You don’t need the major indexes to go up to make money. You just need movement.
And when everyone else is panicking, that’s when options contracts can be picked up at great prices — especially if fear drives premiums lower than they should be.
Here’s what I look for:
- Low-volume pullbacks that hold key support levels.
- Short-dated OMEN Scanner bets in names with relative strength.
- “Crush” setups where IV drops off after a big move.
The last one can be very interesting in this environment. After a big spike in volatility, the market tends to settle down. That leads to “implied volatility crush” — where options premiums get slammed lower.
Volatility crush is brutal if it happens while you’re holding the contracts. But if it happens before you buy them, that’s an opportunity to enter at cheap prices.
You’re basically buying the dip in volatility — and when price starts moving again, those same contracts can go parabolic to the upside.
This can be the difference between 100% and 1000%.
Put Protection and “Double-Dipping”
Another tactic I’ve used a lot in fearful markets is well-timed put-buying.
Puts act like insurance. When the market drops, they rise in value.
So if you’re expecting more selling, grabbing a few puts can protect your long exposure — or even give you a trade to profit off the downside.
Once the panic selling runs its course, those same puts can be sold near the bottom — and the profits can be used to get long.
That’s how you “double-dip” during fear-driven moves. You’re not stuck playing defense — you’re playing both sides with a clear plan.
Where Prepared Traders Shine
We’re moving through a season where the crowd is finally waking up to the idea that markets don’t just go up.
With all the added uncertainty this year, fear is front and center again.
But this is where traders who’ve done their homework have an edge.
You don’t need to call the bottom. You don’t need to predict what Powell or Trump will say next.
You just need to know your setups, be picky with trade selection, and let the volatility work for you — not against you.
Happy trading,
Ben Sturgill
P.S. Most traders never see the biggest moves coming — until it’s too late.
But back in 2022, while most traders were blindsided, one forecast led to a 503% win* on a single trade.
Another spotted the banking crisis nine months early and turned it into 860%.*
Now, Tim Bohen is sounding the alarm on what could be an even bigger move. But this time, it’s not about boring banks — it’s all about AI.
Join Bohen on THURSDAY, April 10 for a “FINAL AI WARNING” to walk you through his forecast — and break down the trading blueprint he believes could hand in-the-know traders an undeniable edge.
It’s free to attend, but seats are limited — Click here to claim yours before it’s too late.
*Past performance does not indicate future results
