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Markets don’t just react to data — they react to tone, language and even offhand comments from Jerome Powell. When the Fed chair speaks — or Trump, for that matter — short-term traders need to stay nimble, because one sentence can send the S&P 500 soaring or collapsing in minutes.
That’s not hyperbole. That’s the tactical reality of trading in 2025.
This morning’s action proved it again. Powell started speaking at 9:30 a.m. on an ECB panel. Within minutes, the S&P 500 spiked more than 15 points — nearly the entire day’s implied move — before any of the scheduled economic data even hit.
That kind of move in five minutes leaves most structured options trades dead on arrival if you weren’t already in.
The takeaway? Traders betting on a directional pop after 10 a.m. were already late. The pump had already happened.
Understand the Catalyst, Not Just the Calendar
There’s a reason Powell is treated like a market-moving event on par with CPI or nonfarm payrolls. He doesn’t even have to say anything groundbreaking — just hinting that rate hikes are unlikely or the economy is softening is enough to ignite buying.
On the flip side, if he leans hawkish or says inflation remains sticky, the market can tank instantly.
That’s why 0DTE traders need to check not just the Economic Calendar but also Fed speakers. If Powell is scheduled for a public appearance, it’s often best to reduce size, delay entries or at least be cautious about expecting “clean” price action tied only to data.
This isn’t just about volatility. It’s about sequence.
If Powell speaks before economic numbers drop, his words will front-run the market’s directional move. That erodes premium and skews the risk-reward of typical bull put spreads or iron condors.
Tactical Adjustments for Powell Days
When the Fed chair is talking, these three adjustments can help protect your edge:
- Wait to trade until after the initial Powell pump — or skip the trade entirely if he starts speaking around 9:30 a.m. ET. The big move may already be priced in before your entry even hits.
- Tighten your strike selection — consider going closer to the money or adjusting your width to reflect lower expected volatility if the move already happened.
- Use smaller size — Powell days are unpredictable. Keeping risk light ensures one rogue comment doesn’t blow up your account.
Remember, the market doesn’t wait for your setup. The best traders don’t either — they adapt.
In short, treat Powell like a live grenade in the trading day. He doesn’t need data to move markets. His words alone are often enough.
And for traders looking to execute high-probability short-term spreads, understanding when that grenade goes off is half the battle.
Order Flow:
This is for informational and educational purposes only. These are not official alerts issued by Lance, but rather some interesting orders picked by the team at Lance Ippolito Trading.
When you look at these plays, always take the market maker move into consideration.
You can be right on the direction but still lose money if the stock doesn’t move enough. That’s where the market maker move comes in clutch.
With puts, they’re often downside hedges in case a stock tanks, especially around earnings. The further out of the money they are, the more likely they are to be hedges.
Also be sure and check when the company’s earnings date is because many of the plays we post here are centered around earnings!
And finally, always remember the golden rule when it comes to buying calls: Buy dips, sell rips — and don’t chase!
If a stock’s moved a ton already today, maybe wait for a pullback.
There is inherent risk in trading. Trade at your own risk.
Note: If no date is listed after the month, it’s the monthly expiration (third Friday).
The team at Lance Ippolito Trading
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*This is for informational and educational purposes only. There is inherent risk in trading, so trade at your own risk.
P.S. Every Trader Should Be Leveraging This 1 Daily Setup
I’ve been playing the market with this simple daily setup since February.
And after nailing 93 daily trades so far, I’m doubling down this new month.
