The market's at all-time highs, and that puts you in a tough spot.
Buying here feels reckless.
Every new record makes the drop look longer, and the air look thinner. But shorting it has been a graveyard, because this rally has run over everyone who's tried to call the top for three months straight.
So a lot of people do nothing.
They watch it climb without them and wait for a crash that keeps not coming.
The advice out there doesn't help, because it's all the same two answers.
Sell, get to cash, wait for the thing everyone's been promising since about 7,000.
Or short it and try to nail the exact top.
Both are a bet on when, and nobody knows when.
Not me, not the guy on TV, nobody. The people who got cute and sold three months ago are still standing on the sidelines.
But there's a third option, and almost no one is talking about it.
And I’m about to tell you what it is…
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To see it you have to quit staring at the price and look at the plumbing underneath the market.
That's where the real story is right now, and it's doing something I've only seen a handful of times.
Let me explain.
Normally, when stocks grind higher, fear drains out of the market, and the VIX falls.
Market up, volatility down.
That relationship has held up roughly 80% of the time for as long as I've been in this business.
You could about set your watch to it.
That is not what's happening.
We're at all-time highs and the VIX is stuck at 16, refusing to come down the way it always has.
The market keeps ripping, but it's pricing in fear the whole way up.
A rally this hard with volatility this stubborn is about as rare as anything I've seen.
There's a whole zone of the volatility chart that just isn't there right now.
Most people look at that and get nervous.
I look at it and see an opening, because I know what stuck volatility actually means.
It means the market is willing to hand you cheap insurance.
The protection that normally costs a small fortune to put on a portfolio is sitting there mispriced, on sale, while everyone's distracted by the new highs.
And that's the third option the sell-it-or-short-it crowd never mentions.
You stay long.
You keep riding this thing, because there's no real reason yet for it to stop. But you ride it with protection already built in, protection the market itself pays for.
So when the news cycle finally cracks, and it always cracks eventually, an Iran deal that falls through, an oil shock, whatever finally spooks the room, you're not the one left holding the bag.
You've already got something you can turn around and sell back into the panic.
Aggressive and conservative in the same position.
Long the rally, covered underneath, and not bleeding money to carry it. That's the whole game.
It's the same thing I used to do standing in the crowd making markets at the CBOE, just translated for a guy sitting at home with a laptop.
The floor teaches you to find these spots. You don't get them out of a book.
So today, I’m releasing my Moonshot Hedge trade.
It's the same trade I'm running in my own retirement account, so you're not watching a theory.
You're watching me do it.
If buying here feels reckless and shorting feels like a death wish, this is the way through the middle.
Give me five minutes. Once you see how the protection gets paid for, I don't think you'll look at a new high the same way again.
Andrew Giovinazzi