What should you do when the market opens?

Mark Sebastian

The Option Pit VIX Traffic Light Is Yellow: Volatility is likely to move Wildly

Since the Federal Reserve made its decision on Wednesday, the S&P 500 is down a touch over 120 points…

The VIX, meanwhile, is down 1.4 points…

A lot of times – and this is something I talk about on Mad Money all the time – when the SPX is down and the VIX is down at the same time, that is a bottom forming.

Is that the case here?

I think we’ll find out today after non-farm payrolls come out.

Heading into the announcement the straddle price is set at a touch over $55 …

If non-farms are strong, look out.

If they’re normal, we might see VIX drop again.

If they’re weak,VIX is going to tank.

Here is what I do know … if the market moves, you want to follow.

Today is going to be a momentum day – take advantage!

I’ll explain VIX’s strange behavior in detail in the Pit Report over the weekend.

Questions about that? Drop a comment below!

Your Only Option,

Mark Sebastian

VIX Edge

Mark Sebastian

Mark Sebastian is a former member of both the Chicago Board Options Exchange (CBOE) and the American Stock Exchange (AMEX), where he spent years mastering the art of options trading in the most competitive environment imaginable. As Chief Investment Officer at the hedge fund Karman Line Capital, Mark manages sophisticated options strategies for institutional clients. He is the author of two highly regarded books on options trading: ‘The Option Traders Hedge Fund’ and ‘Trading Options for Edge.’ Mark is a frequent guest on major financial networks including CNBC, Fox Business News, Bloomberg, and First Business News, where he provides expert commentary on market volatility and options strategies.

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