Besides the Weekly options, the VIX is the best new product in a long time since the SPX. It spawned a whole other class of ETF’s and made all the old time Cboe seat holders a few extra bucks. The Bitcoin future and options will be out soon which might outshine them all. But really I want to talk VIX today.
2600 looms large. We discussed some trade ideas in our Gold Lab today and as much as I love some downside put spreads I can‘t help but think 2600 is soon. As we roll into the close VIX could not hold the 10 handle and the VIX futures could barely keep their tiny gains. Maybe 2600 by Friday since rallying is really all we do.
For a few moments today VIX went backward and traders decided to worry about a tax plan, ECB rate hikes, FANG earnings and whatever else ails a screaming stock market all at once. I don’t see many backward to VIX cash markets at 13 VIX but we had one today. Usually VIX traders have a reason to let VIX cash fly.
Any down day in a week for the SPX that does not see many is significant for VIX. Not that VIX moves a ton yet but for what it sets up going forward. For VIX traders VIX should go up when SPX drops but this is really not a big move on a percentage basis for SPX. After all, the move was less than .50% for SPX but a full 1 point pop in VIX. Even in low vol the VIX cash moved seem a bit rosey.
For a moment there I thought hell froze over as a bi-partisan plan for the AHCA might keep it running for two more years. Keep buying the insurance companies I guess. Today was such a snooze that I have to go observational. NFLX was not enough to excite although 70% stock price gains this year are exciting enough. Let’s talk VIX because it did something slightly not normal but normal today.
charts from VIXcentral.com