Yo Pit Crazies,

I was explaining to my students in a class today how volatility works. I spent 15 years as a floor trader, so I have a pretty good understanding of what's going on.

Option traders don't really pick a direction. They're more like a bookie who makes a line on a sporting event. Some folks bet up, some folks bet down, and the bookie tries to collect the spread or manage the trades they take on.

Most of what market makers do, and that's 90% of who the retail public trades with, is just move markets.

Right now the markets are moving as much as they can until something really happens.

Back on February 28th, President Trump laid out a plan for the Iran conflict. From what I can see, he's still following that plan. There's been no deviation from it except the feints and jabs from his rhetorical storehouse. Just Google President Trump's February 28th, 2026, Iran speech. From what I can tell, he's sticking to that line. Since then he says a lot, trying to end things early, which of course benefits everyone. For the most part he's staying on script.

The chart of the S&P 500 Trust ETF (SPY) is telling the story. The big story is Iran played their one card, shut down the Strait of Hormuz, and now the world has to deal with that. I expect the war planner knew that would happen.

SPY 5 Day Chart

What VIX prices

VIX prices a 30-day range in SPY and SPX. That range is $60 for SPY and $600 for SPX. For where things are, I think that's about fair. That's how VIX can stay high but SPY in the chart above can stair-step up and down.

The thing is now that Iran played the card, SPY will depend on how fast the USA and Israel can stuff it back in the deck. My guess is we'll know in a week or so once the USA buttons up the Strait of Hormuz. After all, it's in the plan. That's why we're either way back up or into darker, uncharted territory.

To get follow up intel and more, check out the Ceres Club at this link.

To Your Trading Success,

AG