IV's Are Starting to Acknowledge Market Accross the Board...Finally

Over the last few weeks we have written blogs noting that IV was too low in Bonds,  SPX, and FX.  We left gold out,  but it also could have been included in this list.  The good news is that it means that markets are finally starting to recognize how much risk there is in the market place right now.  Does this mean we are near a bottom?  Probaby not, in SPX, but some names, most notably oil could be getting close.  OIV, the VIX of Oil was over 75 today.  If it gets into the 80's  that would maret it at levels that equitiy markets saw in 2008.

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VIX Looks Like It Wants to Pop

While the SPX closed well off its lows and the VIX well off its highs, I found it interesting that SPX made the much bigger move.  In addition it still managed to close below the Jan 20 close (while not toughing the lows from that day).  At this point I think as I look at how equities and vol are moving,  VIX looks like it really wants to blow out.  Maybe not to 40 like in August, but I think we are going to see an intra day high that might be near levels we saw in January,  maybe much higher....certainly higher than where we are today.

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GOOG Skew is Flat

GOOGLE announced earingis on Monday and blew the doors off.  Then after breaking the AAPL strong hold on highest market cap stock it has since completely died.  What is interesting is how option traders are playing the move.  Take a look at the skew curve in GOOG options in Feb and March ordinary:


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