Thursday It's Party Time... Friday It's Jobs Grind

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July 3 (Bloomberg) --'s James Ramelli and J.P. Morgan Funds' Andres Garcia-Amaya previews this week's jobs report on Bloomberg Television's "Street Smart." (Source: Bloomberg)

Tomorrow, all over the u.s., it is party time as we celebrate america's independence with barbecue and beer.

But then it is all eyes on the jobs report.

The june unemployment situation comes out at 8:30 a.m. on friday morning.

They expect to add 165,000 jobs.

How are the options traders buying this?

The jobs number is incredibly important.

That is a whole game.

How will it affect markets?

Jim, thank you for joining us.

Good to be here.

First of all, before we get to your options trade, what do you make of what will happen?

We expect a move down to 7.5%. even if we do down taken the actual rate, we won't see that much movement here because we already know what the fed take will be.

I think the number will come in in line with expectations, maybe a little bit higher.

Either way, the movement priced into the market right now is a little too high.

The sp y straddle is at $1.80 right now.

I think that is a little too high.

If the volatility is too high, typically, guys like you, options traders want to sell volatility.

I could go into the market and sell naked options.

But that involves a lot of risk.

I want to look at an iron condor.

I can sell the one .62 and the 1.63 calls went and -- call spread and buy the 150 put.

You see the green area in the center, you are selling a nearby call, a nearby put.

In case you are wrong, you're going to a farther call and a farther output.

We call that a short strangle.

My losses could potentially be unlimited.

So i buy the further out strangle should the market move against me.

You are the strategist at j.p. morgan funds, what do you think is happening with the jobs?

I don't think we want to see fireworks on friday.

We won numbers right in line to confirm what the fed is telling us, gradual improvement and tapering off on the december curie.

-- the summer qe.

-- the december qe.

We wanted to be right in line.

We are looking around 150. we appreciate the trade.

We will be watching knowing ourselves.

This text has been automatically generated. It may not be 100% accurate.


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