iron condor

Is this the revenge of William Wallace?

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So the Fed is leaning toward 2015 to start raising rates? There is not much different in that announcement as the Fed watchers look to parse all the of the twists and turns in the FOMC meeting minutes.  I think that after this long in our plodding recovery market players would be happy to see the Fed exiting.  That means things should be getting better, but that is just me.

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Is the Biotech slide done?

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Stocks posted a slight gain today as the RUT stopped its slide somewhere midday.  The short jump we had in volatility ended with the VIX closing 12.44 down .73.  Without a reason to rally like early in the week, if there was one, stocks are on a meandering path for the short term.  The talk of European stimulus is not giving the market the same gas it did last year or the year before.  At this point, with earnings at the high end, companies need to make more money and for now that is a high hurdle.

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They crushed the VIX, right?

Well, like the Greek referendum in 2012, they came, they voted and stocks rallied.  I am talking about the Crimean’s who don’t seem to want anything to do with the rest of Ukraine.  How it all shakes out is a bit of a mystery, but some very select Ukrainians and Russians will not be able to go to their ATM machines anymore when they fly to London or New York.  That message hit loud and clear as both Russian and US stocks rallied back a bit today.

At the money volatility got hit in all the big indexes as you can see from the Livevol Term Structure slice below.

 

charts by www.livevolpro.com

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Stocks stay on edge

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The upside skew is starting to flatten

 

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Near the end of the day we have a pretty solid bounce in the broader market with stocks recovering all but 6 or so handles from the previous day’s highs.  The reason for the selloff was kind of uncertain, so with just so-so retail sales, things are back up to nicer levels.  As Mark discussed yesterday, the IV only made a tepid response so the bounce is not too surprising.  The quick rally and inability to make new highs over the last 2 weeks has shaken up the upside skew a bit.

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NFP is a big nothing and earning might be too

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A volatility crush on the upside

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Despite the headwinds of the Shutdown and the rollout of Obamacare, employers are hiring again.  An economy that is growing and creating jobs is a good thing.  While there was some concern about the Taper, that does not look like it will happen soon.  That could change next week, but the soft landing is what the market is looking at.

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VIX trying is to make new lows but will it?

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As of 3:30 EDT the market is flat lining just down about ¼ of a percent and VIX is up .33 with the VIX futures just flat on the day.  For the most part, stocks have been leaning on a few things since the last blowout NFP.

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Penney for your thoughts

There is a small sigh of relief in the ongoing Syria Crisis.  Who would have thought that Mr. Putin steps in to be the humanitarian in all this?  Starting the clock two weeks ago almost nothing has been to script.  While the wags will parse the latest out of the State Dept. I want to look at something where the IV was actually up today instead of down.

 

LivevolX (r) www.livevol.com

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