This week, the Federal Reserve is closely monitoring inflation as economic indicators are set to be released: the Consumer Price Index (CPI) on Wednesday, August 12, and the Producer Price Index (PPI) on Thursday, August 13. Recent performances of the Nasdaq-100 (NDX) show that the average price move on CPI Day has been 0.66%, but the last three reports resulted in changes exceeding this average, with the most recent CPI report yielding a notable gain of 1.10%.
In contrast, the average price move for NDX on PPI release days is significantly higher at 0.94%. The most recent PPI report saw a modest drop of 0.28%. Data indicates that consistent sellers of NDX at-the-money (ATM) straddles have made substantial profits of over 500 points on CPI Days, while the same strategy has resulted in a loss of nearly 380 points on PPI Days.
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