The news is out Apple is going to have the I-Phone 6 AND the I-Phone 6 PLUS!!! Plus APPLE PAY and the I-Watch. Based on what the stock did, the market acted to the AAPL conference much like McKayla Maroney would to a Silver Medal. With that the VXAPL got smoked. Even more so, the VIX options expiring this week and next week took it in the chin. That being said, it appears the market is still holding out hope for some more movement here is a chart of VXAPL:
Stocks are going to make a closing high today or near it as I write this post and I can’t help but think we would be way higher if Vladimir Putin could make up his mind what he wants to do in the Ukraine. We know what he wants to do, take a bunch of territory, but the Europeans are still threatening sanctions. That is keeping the VIX into another elevated close and vol. futures bid.
After the record run to all-time highs stocks are stuck today while the violence in the Ukraine continues. We have highlighted the 5% realized vol in the SPX and will not rehash that but stocks are setting up to go somewhere. A name that has been setting up to go somewhere is YHOO.
The stake in BABA has really driven the value in YHOO’s shares recently and the name has been in a range from $33 to $38. It is now at a 3 month high as BABA just released a decent earnings report as it sets to IPO.
I like working at Option Pit with Mark Sebastian and I like our clients. Well one it is fun, most of time, and we have great clients. From time to time we get some solid observations from them. That is another thing I like. Having a different perspective from traders you have helped educate usually means some interesting stuff know the foundation is solid. So I am giving one of our clients some props here for this one. He knows who he is.
Note that when realized volatility dips below 5% on a short term basis it usually does not stay there for too long. I have 10 day RV down around 5.41%. Right now the first 3 Weekly terms in the SPX are all below 9%.
Close but not quite there yet. SPY traded 199.75 today as the 200 level hangs like the Sword of Damocles over the market. Everything is feeling good and long equity positions are kicking butt. In short living the good life like Damocles envisioned. However, the sword is poised to drop if Janet Yellen cuts the horse hair on rates and down the market drops. There is some weird tension on that tenuous horse hair of volatility.
Another day another rally in the good old USA as America Inc. keeps delivering the goods. More solid earnings and home start data got us off to another good start today. Market players are waiting on Yellen to report some lower to stabile rate news, which could send stocks even higher. I see that 200 number on the SPY and can’t help but think that is the next round number to cross the line.
Stocks are shaking off just about everything at this point such as Iraq, Iran, Ukraine, Syria and of course that paradise on the Med, the Gaza Strip. Slow growth in Europe, who cares. WMT swamped in health care costs, take it up. Volatility, well just sell the crap out of it. VIX is now deep into the 12 handle and we might sniff 11% tomorrow.
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We all know the story. Troy is finally sacked by the gift of an enemy-impregnated horse the size of a house. Browsing through the WSJ online I see an an Orthodox Priest blessing a fleet of aid trucks. I half think there might be some Spetsnaz Commandos lying in wait in those bad boys. With the gimpy stock market today I am not the only one. I am all for Putin giving aid to the hungry but it is still tough to believe.
I started trading options as a floor trader in 1991 right about the same time as Gulf War 1. The runup to the war was characterized by gloom, volatility and really weak stock prices. I think the Dow was 2300 or so. Not much has changed in the 24 years since then through several other political crises and GW2. The one constant has been after the USA goes in and starts shooting, stocks rally and the VIX cracks. Until today that is, or maybe.