BY ANDREW GIOVINAZZI
July 5, 2024
Yo Pit Crazies,
Pearl and I went kayaking yesterday. For those that don’t know Pearl, she is my wife’s dog who likes sleeping on the couch when my wife is out. Pearl also is an accomplished sea dog.
I am sure we will be out again today.
Meanwhile VIX is at it again.
UP VIX up SPX for 2024 has usually been bullish
Normally VIX up, stocks up is a bearish signal. In 2024 it has been a bullish signal as traders adjust for the market continuing to rally in a steady relentless march up.
10 day VIX chart
VIX up SPX up going into what should be an illiquid Friday should send stocks higher. There has been some replacement talk for Biden/Harris but for now that is not certain.
Should make for an interesting weekend. I like long SPY, long VIX for next week for a weekend play.
To Your Trading Success,
AG
Andrew Giovinazzi
30-Year Trading Pro
See what's hot at option pit
CAPITOL GAINS: SMR Aug16 7 call closed for a 150% gain
DELTA STRIKE: VLY Mar15 8 puts closed for a 88% gain
PFE May17 26 calls closed for a 66% win
OP MENTORING: SPY Mar22/19 510 put calendars and 520 calls for 6.4% gain
OPTION SHOPPER: ERX Mar28 65 calls closed for a 90% gain
Those movie makers were not too far off. All that stuff is now in the Invesco QQQ Trust (Ticker: QQQ)
You remember Star Trek with the ‘Communicators” that are now cellphones and created 10 Trillion at least in market cap?
Events make the liquidity providers raise prices for the same amount of time
How do I know this? I was one for 15 years, Mark 10 years and Licia for 15 years. That is 40 years and 20 million option contracts. Also, players will wait to place trades while an event is in play. Traders would rather ride a sure wave than place a big bet prior.
The liquidity provider will just pump up the volatility in the options to overcome the daily decay. Trade 1 Greek for another, Theta and Vega. That is just time for volatility.
Look for my Greek Exposition in Option Pit University coming soon.
If the PCE number is just in line post-debate, SPX will fly as the market is waiting for a reason to go higher. Hard to imagine there will be any surprise from the two candidates but that is why the VIX has a bid!
To Your Trading Success,
AG
The Gulf of Maine and the shoreline offer 1000s of fishing spots. An almost unlimited supply of places to go. Right now the stock market, with 1000’s of names to trade, has only one place to go.
That stock is Nvidia Inc. (Ticker: NVDA). On a low volume Tuesday in the June heat, NVDA managed a day where the fund manager had a chance to buy the stock not at all time highs. So they all jumped in and the performance lifted all high quality tech.
Yo Pit Crazies,
It is Voz Free Friday this week. Check out Voz and Mark as the dynamic duo of trading on the close every day in Trade to Close.
My close Tuesday was a bit different, a buddy wanted to go Striper fishing so I did this: