Yo Pit Crazies,

One thing about trading which is my favorite saying is Your opinion is only as good as it makes money. I have a lot of ideas, but they don’t always make money.  The best way to deal with that is to have proper position sizing.  I am going to be out next week on vacation so I know a couple of things I want.

• I don’t want to be trapped in positions expiring next week or Sep15th.
• I want to be on the lookout for cheap duration after the Sep15th.

That is the basis of a trading plan going forward for my allocation of some dollars.  The question is whether or not I am running into a vol buzzsaw this week.

This convoluted graphic gives me an instrument dashboard of what to expect regardless of what I think will happen.  This is something you can learn in Pod 1 and Pod 4 for Pro. We have a few spots open for our custom Pro Pods over the next week.  Join us for the options trading education of a lifetime.

But here’s a nice preview of what to expect:

Short-term VIX9day is pricing very fair right now

Close to the end of the day VIX future premiums were still fair but Sep VIX future premiums were a little higher than normal for this place in the cycle.  With VIX9D<VIX<VIXSep<VIXOct I expect to see green all across the stripe in the Future Delta to TV.

That tells me there is a bit more of a bid for options than expected.  At least into the close on Tuesday, traders were not crushing the vol out of the options.  Not yet anyway.  I am riding some short SPY with a put and short Ipath Series B S&P 500 Short Term VIX futures ETN (Ticker:  VXX) with a put and with the little bump in IV I might get to close the SPY puts and ride VXX puts into lower vol post-vacation.

The would-be Pod 4 in Pro that you can pick up at the Trading Desk.

We have some room so come join us.