Yo Pit Crazies!

Remember those Top Gun days with planes blazing and the “Hard Top” limit on how low a pilot could fly?

The new hard top is the opposite.

It’s a ceiling on how high the market can go. 

Iceman tells Maverick he’s reckless. 

Is the market reckless right now?

Not reckless. Confused.

Stocks are moving without a script

Goldman Sachs (GS) had a five percent intraday range today. Five percent. I must have missed the memo because there was no news, no earnings, no analyst action. Just a massive swing with no clear reason.

JP Morgan (JPM) wasn’t as wild but still showed an unusually large range. Earlier in 2026, people touted bank stocks as the new AI plays. Now they just swing around looking for direction.

Then Iran launched a drone at a US carrier group.

Software stocks showed sudden weakness. Oil stocks mooned on the tension. Tuesday was a day of things moving in opposite directions, and the market couldn’t figure out which headline mattered most.

VIX jumped to Zone 3

When missiles and drones fly, VIX moves up first. It didn’t help that Congress couldn’t govern for a while either. What started as a lazy down day for VIX turned into a jump to Zone 3 and near 20 VIX. Once the news broke, VIX backed off.

Here’s the Zone framework. Zone 1 is VIX under 14, complacency. Zone 2 is 14 to 17, normal chop. Zone 3 is 17 to 21, elevated fear. Zone 4 is above 21, panic territory. Yesterday we touched Zone 3 but didn’t stay there. That tells me the market absorbed the Iran news quickly. It’s not pricing in sustained conflict.

VIX closed right at 18, middle of its range. The geopolitical risk premium showed up for an afternoon and left. That’s the pattern lately. Headlines spike fear, traders buy protection, then everything calms down. Until the next headline.

I still think VIX drops and stocks resume their climb, but Middle East tensions can derail things fast. I sold all my SPY put spreads this afternoon at nice prices. I want to sell my VIX puts at good prices by the end of the week. If we get another headline-driven spike, 

I’ll use it to exit. You should, too.

Rant & Rave

Two government shutdowns in three months. Congress, this is easy. You spend too much money, don’t know where it goes, and hold no one accountable for fraud. The US government spends billions on dubious asylum claims but almost nothing on rooting out fraud. DOGE tried for three months. Everyone lost their minds. Now we know why. Fake voters, fake citizens, fake government assistance recipients, and NGO grift everywhere.

We need term limits now.

Want proof? Part of the budget deal rolled back SNAP benefits for junk food. Pepsi immediately dropped prices. That means Pepsi was charging more because taxpayers were footing the bill through SNAP. We were subsidizing soda. Color me shocked.

The market point: Every shutdown threat adds a VIX spike. Congress can’t govern, and traders pay the volatility tax.

To your investing success,

Andrew Giovinazzi