As we are heading towards the most crucial event of the year FOMC statement. As per the survey 49% of an analyst are expecting rate hike by 25bps and that was expected long ago. But what matters is the Dovish tone.
But what does that matters to us? Well all we need is volatility and looking at the option price we assume high volatility will remain in the coming weeks. Hence we advice ( Short butterfly option strategy)
Sell 1 8000 CE at 71
Sell 1 7800 CE at 190
Buy 2 7900 CE at 226
Pay off :-
