Let’s talk about no man’s land.
It’s a phrase I tend to throw around a lot when the market isn’t giving us a clear signal. And I don’t mean it to be a “get out of jail free” card so that I don’t have to make a prediction…
In fact, I think it’s actually an important cycle that requires action.
But what does it actually mean? More importantly, how do you trade when we’re in this kind of environment?
Some traders hear “no man’s land” and assume that means sitting on their hands, doing nothing. That’s not my approach. Instead, I adjust my strategies to account for more open-ended possibilities rather than making a bold directional bet.
The Market Is at a Crossroads
Right now, I hear a lot of people saying, “The market got rejected at the highs. We’re headed lower.” Here’s the chart for SPY:
As you can see, it’s not a bad take. The market has turned back from a new high.
But it’s not a sure thing either. It’s just as likely that we saw a one-week flush before the market rips through those highs again.
Just look at the snap-backs from November, January, and February.
The rejection action we’re seeing now isn’t new. We’ve been watching this same back-and-forth for a while — strong momentum moves that end up meaning very little in the bigger picture. One week we’re up, the next we’re down. The market has been incredibly resilient to downside pressure–even on monster 3-4% negative moves like we’ve seen in 2025 (remember that weekend gap? Wow), so I’m hesitant to get too bearish.
At the same time, I’d be lying if I said this market doesn’t make me nervous right now.
That’s why I call it no man’s land.
How to Trade in No Man’s Land
When the market lacks clear direction, traders start looking for ways to hedge their risk. But I’ll be honest — traditional hedging doesn’t really float my boat.
In my experience, hedging caps upside without truly protecting downside risk the way traders hope it will. Instead, I prefer more active strategies that allow for flexibility.
Here’s what I do:
1. Using Pair Trades for Unlimited Upside
One of my favorite approaches in uncertain markets is pair trading. Instead of just hedging downside, a well-executed pair trade allows for unlimited upside in both directions.
I went into detail about my favorite pair trade during today’s Mapping the Market session, but the key idea is simple: find two related stocks that tend to move together, but take advantage when they temporarily diverge. This gives you a way to profit from the spread closing, no matter which direction the market moves.
2. Selling Covered Calls to Generate Income
Another move I make during uncertain times is getting more active with my long-term portfolio, not by buying more stocks, but by selling calls against my holdings.
If you’re not familiar with covered calls, it’s a strategy where you sell call options against stocks you already own. This generates income in the short term while allowing you to capitalize on stagnation or even slight downward movement.
Now, if you’re thinking:
1. What the heck does that mean?
2. Wait… I thought you didn’t like hedges?
Good questions!
Unlike traditional hedging, selling calls isn’t about canceling out risk. It’s about monetizing uncertainty and giving yourself a built-in balance of extra income vs potential upside.
I’ll break down exactly how I approach covered calls (and how to balance them properly) in today’s Mapping the Market session.
Join me, and let’s navigate no man’s land the smart way.
See you there!
— Nate Tucci
