BY ANDREW GIOVINAZZI
September 19th, 2025
Yo Pit Crazies,
The SPDR S&P 500 Trust (NYSE: SPY) finally closed up today, with the VIX ending down.
I say “finally” because even though the market was up, the VIX didn’t want to lose ground. That is not how it is supposed to work after the biggest FOMC announcement in two years.
Those two normally trade opposite each other.
It’s almost like the market is giving us advance notice of some bad news.
I learned a long time ago in the trading pits to avoid the SPY after a major event and do this instead.
The Calm After the Storm
Think about it like this.
There are a lot of pent up spirits leading into an event and then they get released. The first day or two after the news tells the tale of the tape. Right now, that tale is a bullish SPY. It is trading higher but not a lot higher after.f I was still a market maker, I’d sell options wherever I could.
That’s because I expect option premiums to fall because there is nary a news item on the horizon.
News causes uncertainty. That leads to more volatility, which pushes option prices up.
I am still leaning short VIX via puts, but there is a potential fly in the ointment: the Congressional Budget. At its current pace it threatens to soak up every dollar in GDP.
My guess is the Republicans will pass a bill and spend more money. That should suck the air out of VIX and giving us a Zone 1 or a Sub 13 VIX.
To your Trading Success,
AG