Size Up OTM VXX Call Spread Says WARNING
Yesterday was not a big deal. The key: We have seen much more volatility on rallies than we have on sell offs. I mean 25 points is not nearly what we moved on Thursday of last week. While that is a nice uptick from the movement the VIX was showing in the prior few weeks, 10 […]
Twitter Controversy is good for Volatility
I have said multiple times: politics do not matter… …except when they have a deep economic impact. Over the weekend Twitter permanently banned President Trump. Let me be clear…this is apolitical… Banning President Trump is a bad economic decision for Twitter. The president has millions upon millions of followers. These people are going to use […]
The Option Pit VIX Traffic Light Goes Red
The VIX traffic light was dead on when it switched from Red to Yellow. “But Mark, the VIX went up, and then down, and is back where it started…how is this dead on?” You might ask. Remember, a yellow light does NOT mean that the VIX is going higher. A yellow light means the VIX…
Making Trading Sense of the Capital Being Stormed
Wednesday was a political event (and sad in that someone lost their life). However, as the VIX was popping and markets were selling off, I was not jumping on the long volatility bandwagon. I was shorting vol. In Little John I made the call to buy puts on UVXY. I also used that time to…
Call Buyers are Back!
One of the big themes from the second half of 2020 was the absence of call buyers. Over the last 6 months, puts have averaged more volume than calls. Calls averaging about 200k contracts, and puts about 215k. But NOT Tuesday! Take a look at this: Remember, as much as retail loves to set up […]
The Option Pit Traffic Light for VIX is Yellow
The Option Pit VIX traffic light has teetered on changing colors a couple of times over the last two weeks. The move on Monday was enough to trip it to yellow. Two main pieces of the indicator moved it. First the VIX went partially “backward.” No Im not talking about Marty McFly and back to […]
Customer Trades a Big March Put Spread in VIX
I’ts the beginning of the year and BAM!! A customer put on a pretty big trade in the VIX. Early in the 1st trading session for the year, a customer executed a large block of VIX put spreads in March… The Customer bought 10,000 of the March 22 puts and paid $1.97 To reduce the […]
Oil Volatility is Probably Too Cheap
“Oil Volatility is Probably Too Cheap” In Wednesday’s webinar ‘2021 Trading Secrets Every Investor Needs to Know’ Frank Gregory (our resident DC Insider) pointed out that the 1st thing new President Joe Biden wants to do is rejoin the Paris Accords. To many this might mean ‘oil is going to sell off.’ I personally think…
Today, December 30th VIX Forecast
Hey Traders, The VIX Light is Red, but barely. This means that while I still expect the VIX to fall over the next 2 weeks, I’m less sure about it than I was yesterday. Why? While there are several drivers in my VIX Light that moved on Tuesday, the one that stuck out the most […]
ALARM!!(NOT!)… VIX Light Inside
Hey Traders, The S&P 500 was up just under 1% on Monday. The VIX was up slightly as well … This would sound the alarms, as one of the pieces of our volatility trading system is how the VIX is correlating to the S&P 500. The VIX, because of the way volatility is calculated versus…