BY ANDREW GIOVINAZZI
May 23rd, 2025
Yo Pit Crazies,
In Ripzone, I’m currently sitting on some solid gains—around 50%—from call and call spread positions. I’ve been wanting to close them, but I just can’t bring myself to do it. With the long Memorial Day weekend ahead and the “Big Beautiful Bill” having just passed the House, I’m holding on to these upside volatility trades.
The bill is so bad, it’s got Mark thinking Treasuries could get blindsided any day now—and honestly, I can’t blame him. In just the past week, we’ve seen Moody’s (rightly) downgrade U.S. sovereign debt, the disaster that is the Big Beautiful Bill, and DJT randomly slapping tariffs on Tim Apple and the EU. Volatility seems far from over.
Not long ago, that kind of news would’ve sent stocks tumbling—and initially, it did. But each time, traders stepped in and bought the dip, which sent the VIX ripping right through my zones.
Now where does that leave us?
To a flat VIX Curve of course
There’s flat—and then there’s really flat. The VIX curve below is about as flat as I’ve ever seen, with just 0.26 separating the low and high ends. VIX cash at 22.21 is right in line with that. Based on 13 years of watching this market, a flat VIX curve like this typically precedes outsized moves in the short term—either up or down.
That’s why I’m leaving the upside Vol positions in Ripzone open over the weekend.
VIX curve on May 23, 2025 3:38 pm ET
All the bad news in the world couldn’t drag this market down this week. At this point, the only thing that could is a sharp selloff in bonds—and Mark’s got that angle covered next week.
PS- I am still holding my PTON calls
To Your Trading Success,
AG
Andrew Giovinazzi
30-Year Trading Pro
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