Disclaimer
This is for informational purposes only.
Discussion
Trade: While I was off line I added back half of the contracts I took off, then I just sold out of them again, so I’m back to a 1/4 allocation to the QQQ puts.
Rationale: I don’t love how VOL is acting right now from the perspective of being short the market, but I have high conviction in my view that we sell off to circa SPX 4400 before August 10 CPI. I think what’s probably happening right now is the market is setting up for a positive reaction from AMZN tonight (AAPL is toast, IMO), and perhaps a reasonably strong NFP offset by soft AHE. I think you get a pop on all that tomorrow morning, then the bond sell-off resumes into EOD. I will look to get back to a full 1/2 allocation to the QQQ puts into that spike tomorrow morning.
Exhibits
Implied volatility data.