Hey OP Crew,

AG’s alter-ego Vol Man here with my weekly analysis. As usual, I will start with my last forecast…

If some of my Option Volatility Jargon is vexing, our Glossary is here.

Last Week: 

“FOMC and NVDA split this week are the big known items.  NVDA could well go the way of many splits and selloff post-split for a bit.  If those dollars flow to other stocks that likely will be a VIX flat event.  Traders are looking for the Fed to hold the line as I described above.  Unless there is a big surprise, expect a vanilla summer time week with realized vol in the single digits.  SPX  will struggle to make an all time high and coast between 5300 and 5375 at a 9% realized volatility.”

I am going to call it not great on my ouija board guess.  NVDA is adding 20 billion dollars in market cap every tick at this point and was the only stock up all week after a momentary selloff post split.  $117 to $130 is nothing to sneeze at.  SPX broke 5400 and closed near all time highs.  My only real win was realized vol is at the lows of the year in SPX.

Jpow walked back all the rate cut talk to 1 this year.  I have been firm in my belief he cannot cut while the USGOV spends like a drunken sailor.  At this point it is malpractice by the politicians.  Really only the Mag 3 stocks of Microsoft (Ticker: MSFT),Apple Inc (Ticker: AAPL) and Nvidia Inc (Ticker: NVDA) pulled up the S&P 500 this week.  That is really the push and pull for market sentiment, spending and debt versus business growth.  

By the end of the week, European politics entered the VIX somewhat on Friday as those bond markets were caught in turmoil.  That pushed VIX up into the weekend before a 4 day week next week.  It might have an effect if bond markets take and cause equity liquidation in the short term.  That is something to watch.