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Here's how to profit from the volatility: Trader

Market is stuck in a range--how to play it: Trader

While some investors are hoping the volatility in the markets will subside, one trader is hoping for more, employing a unique strategy that is most profitable if the market continues its wild ways.

"The market is stuck in a trading range," Andrew Keene said Tuesday on CNBC's "Trading Nation." "Every time we find buyers, the sellers come in and vice versa."

Looking at a chart of the SPY, the ETF that tracks the S&P 500, Keene identified two key levels on the chart: the high-end of the range, which comes in just under $200 and the low-end of the range at $190. "I think the range will continue," said the founder of Keene on the Market.

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To play into the recent volatility, Keene is using what's called an iron condor, an options strategy that looks to trap a stock in a defined trading range. In this setup, a trader will combine a bear call spread with a bull put spread—both of the same expiration. Specifically, Keene sold the September 199/200 call spread and sold the 190/189 put spread for a total credit of 60 cents. That 60 cents is the most he can make, and in order for Keene to keep all that money, he needs the SPY to be between $199 and $190 by September expiration, or through next Friday. The SPY is currently trading around $197.

"I have a $10 range to make money here," added Keene. "I'm fading the rally, but not aggressively fading it because I think we'll be stuck in this range."

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