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Options Weekly 0119 | Greenland tariff standoff, gold and silver surge again, Fed chair pick takes shocking turn! Watch Intel and Netflix earnings

This article comes from the 'Options Weekly' column, which brings fellow investors a recap of last week’s market activity, highlights key themes for the current week, and analyzes potential options trading opportunities. Welcome!Click hereJoin the learning session, and you will receive notifications when new updates to the column are available.

The just-concluded weekend was packed with major developments.First, on Friday evening, Trump made comments about Kevin Hassett—the leading candidate for the next Fed chair—hinting that he might be 'out of the running.' Over the weekend, he also threatened to impose a 10% tariff starting in February on eight European countries over the Greenland issue, with a further increase to 25% by June.

This week also features major earnings reports from companies like Intel and Netflix,With macro events intertwining with earnings season, what kind of ripple effects might we see in the options market?We continue to systematically map out the trajectory of key events and uncover potential options trading strategies.

Dramatic Reversal in Fed Chair Race! Is Hassett Out? Watch the PCE Data

The race for the next Federal Reserve chair has taken a dramatic turn. Although Trump praised top contender Kevin Hassett, he explicitly stated he wanted him to remain in the White House as an advisor—a move widely interpreted as effectively ruling him out of the running. According to Polymarket data, Hassett had long been the frontrunner, with his odds of appointment soaring to 85% in December last year.But after Trump's remarks, it plunged sharply and had fallen to single digits by this past Monday.

Meanwhile, another 'Kevin'—former Federal Reserve governor Kevin Warsh—has surged ahead as the leading contender for the next Fed chair.

The much-anticipated announcement of the next Fed chair now appears increasingly uncertain. In November 2025, U.S. Treasury Secretary Bessent suggested a decision might come before Christmas, while Trump said in late December that an announcement would be made sometime in January 2026. However, with dramatic shifts in personnel signals, investors now worry that even the end of January may pass without clarity.

A similar pattern of constant rumors but no definitive resolution has also emerged around U.S. tariff decisions—the proverbial 'other shoe' has yet to drop.The U.S. Supreme Court has already postponed its ruling twice this month, with the next potential window for an announcement set for January 20 (this Tuesday). If further delayed, the ruling could be pushed into late February.

Additionally, on Thursday evening (Beijing time), the Federal Reserve’s most closely watched inflation gauge—the Personal Consumption Expenditures (PCE) price index—will be released.Both CPI and PCE are inflation indicators, but they assign different weights: CPI places greater emphasis on housing and tangible goods, whereas PCE gives higher weight to services such as healthcare, financial services, and software.

Last week’s December 2025 CPI data came in below expectations overall, reinforcing the 'Goldilocks' narrative, though institutions like Morgan Stanley have noted thatdue to differences in weighting and the prior government shutdown, the PCE measure could show inflation re-accelerating.

Opportunity Analysis

Since Hassett is viewed by markets as a staunch Trump ally who favors more accommodative rate cuts to support the administration’s growth goals, Warsh—the newly emerged frontrunner—by contrast, previously served at the Fed and enjoys stronger credibility on Wall Street, making him a more 'predictable' choice.Hassett's 'exit' suggests that future Fed policy may become more conventional.

As we noted in a previous weekly report, Wallash is known for criticizing the central bank's bloated balance sheet and could push for functional reforms and structural balance sheet reduction at the Fed. However, Wallash has also publicly stated that central bank independence is not incompatible with interest rate cuts—a stance that likely served as a prerequisite for securing an interview with Trump.

As a result, traders who had been betting aggressively on rate cuts began pulling back last Friday, driving short-end U.S. Treasury yields higher and the dollar briefly stronger, while gold and silver prices pulled back due to cooling rate cut expectations (though they rebounded to new highs on Monday amid escalating tensions over Greenland).For markets, as the balance tilts toward Wallash—who is perceived as more independent—concerns about the Fed becoming 'politicized' may ease temporarily, though the battle over the direction of monetary policy is far from over.

Options Strategy

U.S. equity markets were closed on Monday for Martin Luther King Jr. Day.Amid rising tensions over Greenland and widening U.S.-EU rifts, major U.S. equity index futures are all trading lower. Barring a clear de-escalation, implied volatility (IV) at this week’s open is expected to rise significantly.

Markets may initially gap down on panic, then watch closely for any softening in Trump’s rhetoric and whether he continues his well-known 'TACO strategy'—as has happened multiple times before—by stepping back after applying maximum pressure.Fellow investors can use this week $SPDR S&P 500 ETF (SPY.US)$ 、 $Invesco QQQ Trust (QQQ.US)$ broad-market ETF options to trade around these macro events.

(1) Mildly bearish

If you believe the market will continue to decline this week due to panic but won't experience a crash-style plunge, considerBear Call Spread. This strategy is suitable when you expect the market price to fall but believe the decline will be limited.

Sell Call A + Buy Call B, where the strike price of Call A is lower than that of Call B. Profit can be realized as long as the index declines moderately, and the maximum loss is limited to the net premium paid.

(2) Go long on volatility

This week, macro factors—including tensions over Greenland, Federal Reserve appointments, and PCE data—will create expected market turbulence, making long volatility strategies such as Long Straddle/Strangle worth considering. Currently, the VIX, which measures market fear, has not risen significantly, and implied volatilities for the two major equity ETFs remain relatively low.

Escalating Arctic Geopolitics: Investment Strategies Amid the Greenland Tariff Dispute

Over the weekend, Trump posted that he might impose a 10% tariff on eight European countries that do not support the U.S. plan to acquire Greenland, with rates potentially rising to 25% in several months until a deal is reached to 'fully and completely purchase Greenland.' This sparked concerns about a renewed trade war. As a result, global markets saw heightened risk aversion on Monday, with safe-haven assets like gold and U.S. Treasuries rising while U.S. stock index futures declined.

Opportunity Analysis

Beyond aiming to secure Greenland’s abundant rare earth mineral resources and gain control over Arctic military shipping routes, Trump also has domestic political motives—particularly as an election year approaches—by promising voters that strengthening America’s global leadership will boost his political support.With the 2026 midterm elections approaching, Trump needs to demonstrate tangible results under his 'America First' agenda. Even if the island purchase fails, the threat of high tariffs serves as significant leverage to pressure the EU into concessions on other trade agreements, such as digital taxes and auto tariffs. Recent polling shows,Trump's overall domestic approval rating remains near the low of around 40%.

Geopolitical tensions combined with tariff expectations are weighing on risk appetite in the broader US equity market, as the specter of a trade war returns. Renewed tariff threats are reigniting the 'reflation' trade narrative, pushing US Treasury yields higher.

Escalating global geopolitical tensions are directly drivinggold and silverprices higher, with their inflation-hedging attributes reactivated in the context of tariffs.The defense and aerospace sectorcould benefit from heightened strategic tensions, such as $Lockheed Martin (LMT.US)$、 $Jacobs Engineering (J.US)$ 、 $Northrop Grumman (NOC.US)$ 。

Rare Earths and Critical Mineralsbeneficiary stocks $MP Materials (MP.US)$which stand to gain directly,If the Greenland acquisition is blocked, MP—the only rare earth miner based in the United States—would become a scarce strategic alternative. If the acquisition succeeds, MP also has a high likelihood of participating in Greenland’s development as a technology partner.

Diplomatic mediation remains the biggest risk, as Trump's style is highly unpredictable. If subsequent tariff threats are suddenly lifted, safe-haven assets could face a sharp pullback. Congressional opposition is also possible, particularly on sensitive issues such as taxation and tariffs.

Options Strategy

$iShares Silver Trust (SLV.US)$ Current volatility remains extremely high, with implied volatility (IV) already reaching the 99th percentile—a historically extreme level. $SPDR Gold ETF (GLD.US)$ Although its volatility is not as high as SLV’s, its IV percentile has also reached 77%.This means option pricing has already embedded a substantial risk premium. Buying options outright (long calls/puts) now carries very low odds of success—because even if the directional view is correct, a decline in IV (IV crush) could still result in losses. Strategies that short volatility or employ spread structures are better suited.

From a technical perspective, gold has been trending higher along an ascending channel since its late-October low, confirming a firmly established uptrend. However, the Relative Strength Index (RSI) has entered overbought territory, putting upward pressure on gold prices near the upper boundary of the channel (around $4,700).

If gold can consistently close above the $4,700 resistance level, the bullish trend is likely to continue; otherwise, any pullback would keep gold trading within the channel in a consolidation pattern. Spot silver has surged significantly, strongly testing the key resistance level at $93.00 and hitting a new all-time high.

Silver’s dominant short-term trend remains bullish, but investors should note that the gold/silver ratio (gold price ÷ silver price)—a key relative valuation metric in the precious metals market indicating how many ounces of silver one ounce of gold can buy—has fallen to a 10-year low. If this imbalance persists, there is a risk of a correction following overbought conditions.

（1） Bull Put Spread — suitable for investors who believe precious metals will not decline in the near term.

For investors looking to capitalize on this upward move, a Bull Put Spread is advisable given current high IV levels. This strategy is essentially a 'low-risk short put strategy' with characteristics of an option seller, best applied when expecting the market not to fall.

This strategy generates premium income while reducing the seller’s risk exposure. Therefore,It is suitable to construct when implied volatility is high, as it can generate profits even if the stock price remains flat, range-bound, or volatile without a clear direction.When the stock price rises above the higher strike price, both options are out of the money, resulting in maximum profit equal to the total premium received at initiation.

(2) Short Iron Condor – Suitable for investors who believe current volatility in precious metals may be overestimated.

In the short term, Trump’s remarks and the market’s reaction could lead tosignificant market volatility, but such events typically have only a short-term impact, after which the market may revert to a certain trading range. If one believes the market has overestimated implied volatility and the direction of the stock price movement is unclear, selling options to collect premium—i.e., implementing a Short Iron Condor—allows one to bet on the eventual mean reversion of volatility. The Short Iron Condor is an options strategy with limited profit and limited risk.

However, it should be noted that this strategy is best suited for scenarios where the underlying price is expected to remain within a relatively narrow range going forward, thus requiring precise timing. It is advisable to enter the position early in the decline of market volatility, after the initial news has fully priced in.

Intel Earnings: Can the 18A process node and CPU shortages sustain the stock’s recent rally?

Last week, $Taiwan Semiconductor (TSM.US)$ the company’s earnings report and investor call sent a strong signal: amid the AI boom, chip demand has surged, with its capacity fully booked through 2027, sparking a rally across the semiconductor sector.This week, $Intel (INTC.US)$ will release its earnings report after market close on January 22, drawing significant market attention.

Opportunity Analysis

In the first half of January 2026 alone, Intel’s stock has shown strong performance, surging approximately 30% in just the first three weeks of January, continuing its recovery trend from a full-year gain of 84% in 2025. The core drivers behind this rally can be primarily summarized asinitial success with its leading-edge process node (18A) and the narrative around CPU shortages.

Investors’ focus has shifted away from traditional short-term financial metricstoward the company’s execution on its long-term strategic transformation and the realization of future growth drivers.During last quarter’s earnings call, the company provided midpoint revenue guidance for Q4 2025 of $13.376 billion, while the market consensus estimate for non-GAAP earnings per share (EPS) stands at -$0.091.This earnings report is expected to draw close scrutiny regarding Intel’s technology roadmap tied to its 18A process node and the specific timeline for ramping up production capacity.Analogous to Taiwan Semiconductor, Intel’s move to increase capital expenditures for 2026 has significantly boosted market confidence, reinforcing the view that AI-related supply-demand imbalances will persist. Based on management’s commentary and strategic plans during this earnings call, the market will reassess the growth potential across Intel’s various business segments.

Options Strategy

Currently, the stock’s put/call ratio—based on both trading volume and open interest—stands at 0.44 and 0.74, respectively, relatively low levels that reflect widespread bullish sentiment. However, implied volatility (IV) has risen sharply and now sits at the 79th percentile of its one-year historical range, with an absolute level near 67%, indicating expensive option premiums. Open interest distribution shows substantial call positioning concentrated around the $50 strike, while key put positions cluster near $40, establishing near-term resistance and support levels.

Technically, the stock has broken above $46.00 and is now approaching the resistance zone near $50. The KDJ indicator has formed a bearish crossover in overbought territory, with the K value exceeding 80, signaling heightened risk of a short-term pullback.

Intel's short-term price action often exhibits impulsive moves, followed by periods of consolidation. Investors who already hold the stock may considera covered call or a long collar strategy. A covered callgenerates premium income by selling calls near resistance levels or high price points. Even if the stock price declines or trades sideways, the premium provides a cushion; if the stock surges beyond the strike price, the investor must sell the underlying shares at that price, effectively locking in profits at a predetermined high level.

Netflix Earnings: Massive Acquisition Fuels Uncertainty

$Netflix (NFLX.US)$ will release its next quarterly earnings report after market close on January 20,with market focus primarily on the health of its core financial metrics, user growth and monetization capabilities, progress on major strategic acquisitions, as well as its 2026 margin guidance and debt management plans.

Last quarter, earnings per share (EPS) missed expectations due to issues such as a tax dispute in Brazil, while rising content costs and investments in global expansion raised concerns about the sustainability of its profit margins.

Opportunity Analysis

Current market consensus forecasts revenue to increase 16.79% year-over-year to $11.967 billion and EPS to rise 29.30% year-over-year to $0.552. Over recent quarters, average revenue per membership (ARM) has remained stable at around $11.60.

Following the initial benefits from cracking down on account sharing and launching ad-supported subscription tiers,growth in the North American market has naturally slowed, shifting investor attention toward the quality of its global expansion.The market is closely watching the progress of the ad-supported subscription tier, given thatthe company previously stated it 'expects advertising revenue to double this year,' which is viewed as a key new engine to offset slowing user growth.。

Meanwhile, Netflix’s recent proposal to acquire Warner Bros. in an all-cash deal valued at as much as $83 billionhas raised market concerns about its financial strain, surging debt, and integration risks.

Options Strategy

Currently, the stock’s put/call ratio (based on volume/open interest) stands at 0.50 and 0.88, respectively,indicating market confidence in a share price rebound following consecutive pullbacks.In terms of volatility, the stock’s implied volatility has risen significantly, sitting at the 89th percentile of its historical volatility over the past year, with an absolute level of 46.73%—substantially higher than its historical volatility of 15.27%. Examining open interest across the next four expiration dates, large call positions are concentrated at the $95 strike, while significant put positions target $80, potentially establishing near-term resistance and support levels.

(1) Looking to establish a position at lower levels

Market sentiment is deeply divided on the Warner acquisition. For investors seeking to buy the dip, the best approach is to proceed incrementally: take a small initial position ahead of earnings, and then add to it only if the company reaffirms its 2026 margin guidance and debt management plan in the earnings report and the stock holds above key resistance levels. Alternatively, consider entering near critical support zones.Sell cash-secured put options(Cash-Secured Put), to collect premium or wait for an opportunity to buy the stock at a discount.

(2) Bullish on individual stocks with a conservative approach

Since buying calls outright is currently too expensive, investors may consider buying an in-the-money (ITM) or at-the-money (ATM) call while simultaneously selling an out-of-the-money (OTM) call with a higher strike price, forming aBull Call Spread. This significantly reduces the capital outlay and offsets some of the risk from a decline in implied volatility (IV). As long as the stock doesn’t fall further, there’s still potential for profit—not only lowering premium costs but also mitigating part of the 'volatility mean-reversion' risk. The maximum loss is limited to the net premium paid, though this strategy also caps upside potential.

Wei Wenbo, Analyst at Futu Securities

CE: BUI890

(The author is a licensed person regulated by the SEC, and neither they nor their associates hold any financial interest in the recommended stock issuer.)

(Options education is provided for investment learning purposes only and does not constitute specific investment advice.)

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Disclaimer

This content does not constitute an offer, solicitation, recommendation, opinion, or any form of guarantee relating to any securities, financial products, or instruments. The risk of loss from trading options can be substantial. In certain circumstances, your losses may exceed the initial margin deposit you made. Even if you have placed contingency orders, such as 'stop-loss' or 'limit' orders, these may not necessarily prevent losses. Market conditions may render such orders unexecutable. You may be required to deposit additional margin on very short notice. If you fail to meet such margin calls within the stipulated time, your open positions may be liquidated. Nevertheless, you remain fully liable for any resulting deficit in your account. Therefore, prior to trading options, you should thoroughly study and understand how options work and carefully consider whether such trading aligns with your financial situation and investment objectives. If you do trade options, you should become familiar with the procedures for exercising options and handling expiration, as well as your rights and obligations upon exercise or expiration.

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