BY ANDREW GIOVINAZZI
August 29th, 2025
No, I’m not talking about Unity Inc. (Ticker: U)—though that was the first trade I jumped into for Licia’s Challenge. The stock had pulled back nicely, which was all I needed. I’m off and running.
The selloff I was referring to was in the S&P 500 Trust ETF (Ticker: SPY), which dropped to around 643—a level we hadn’t seen since the start of the week. Volatile market? Hardly.
10 Day SPY Chart
In fact, ever since Chairman Powell hinted at a potential rate cut, the market has looked pretty upbeat. But a 1% trading range for SPY over an entire week suggests there’s something else going on.
VIX was very responsive on a small move in SPY
The VIX remained elevated relative to SPY’s narrow range. Despite only a 1% move from top to bottom over five trading days, a firmer inflation reading rattled investors. If SPY is rallying on hopes of a rate cut, traders are now looking for softer inflation data to justify that optimism.
We didn’t get that softer inflation print today, yet stocks barely sold off—and we didn’t even close at the week’s lows. The market clearly doesn’t want to go down. Based on today’s action, I’ll be positioning for a bullish move in SPY on Tuesday, along with a fade in the VIX. If SPY isn’t falling, the VIX likely will.
In the meantime, I’ll be finishing up my chicken coop over the long weekend. Wishing you a relaxing and enjoyable Labor Day Weekend!
To Your Trading Success,
AG