IV

Will Greece make it happen?

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 “Greece’s Creditors Set to Throw Down Gauntlet With Proposal for Bailout Deal”  WSJ

 So this is the final hour and Greece is going to get a take it or leave deal to stay in the Euro Zone.  The months of time wasting and theatrics by the left-wing Syriza party is set to end.  If the selloff in bond prices is any indication, the young Greek government will take the deal.

 

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Cheapest volatility on the planet- TWTR that!

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Stocks regained from lows today after a near panic selloff in Chinese equities.  Prices here are down only fractionally as selling in China and the accompanying volatility is becoming habit as Beijing  tries to kill the speculation.  On the opposite side of the spectrum is TWTR.  Not a lot of speculating there.

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Another bite out of AAPL

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Apparently the Greece deal with the Troika is imminent.  That was enough to send VIX lower as it re-finds the 12 handle with the volatility futures hovering and not ready to make any major breaks today.  We might rename this Semi-Wednesday as traders bid up all sorts of semiconductor names on the BRCM takeover news.  I think there is a simpler trader out there.

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Blame in on Rio

 As long as one of the big 4 (EU, Japan, USA or China) is still in the QE way stocks are bound to tumble on good economic news.  USA is out, China thinking and Japan and the EU are in full swing.  Today the EU is reaping the benefits of tough fiscal policy and looser monetary policy with growth looking better so stocks sold off.  The strange result of QE is that good news is bad news for stocks and that is the present reality.  To the extent this small selloff lasts will probably be answered by the ADP number in the morning. We will probably bounce on a middling number.

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IV goes into High Orbit

Stocks ended the week in an ugly fashion with the SPX down about 1.25%. There was enough in the bad sentiment train with Greece, Euro Area deflation, poor GDP and Russia annexing another part of the Ukraine. Not the stuff of rising markets with earnings only tepid this season. So far most companies that are reporting are doing better than estimates. Not 80% to blow it out but just ok.

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Like the Loved FB

One thing I always like to keep an eye on is how 'high fliers' perform in sell offs. In these most recent sell offs 'loved' names like TSLA, AMZN, GPRO, and AAPL have gotten a bit of a smoosh.  One 'loved name' that did exceptionally well in this sell off is FB. While AAPL dipped to 108, and GPRO back to 55,  FB stayed somewhat healthy never breaking 74.

Chart - FB_window_screenshot.png

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When Volatility Does Not Tell The Story

Today, the SPX settled down .49 points. This will show up as essentially as a 0 in realized volatility terms as measured by GARCH which is what most brokerage firms use to measure HV.  But does that tell the whole story?

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LivevolX (r) www.livevol.com

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VIX Might Finally Break

As I look at VIX, I believe it might finally be ready to break.  There are a few historical things that point toward a drop:

1.  We are entering the holidays, always a time when things tend to drop

2.  There are very few economic data points coming out till next friday.

3.  And finally there is this:

Chart - ^SPX_window_screenshot_0.png

LivevolX (r) www.livevol.com

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INTC IV Looking Big

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Another toxic brew for stocks today as equates drifted down around 1+% for the day.  None of this was really attributable to the numbers.  ADP was ok but the Ebola, HK, Russia, ISIS concoction of market sadness kept sentiment weak.  Note how all the problems are more political than anything else.  They need the will to solve them.  This did drive IV up to some higher levels so those with some dry powder listen up.

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