Fake news, real news, no news, blue news… it appears that we have had a lot of flip flopping and flat out surprises on news stories lately from the failure of the tax bill to the miraculous resurrection of the same. SPX found a way to trade to ATH briefly today but the NDX has not been so fortunate of late. Granted the rally in 2017 has been spectacular for NDX.
We are in a bit of sell the news sadness. NDX really rallied on tax hopes but now that most of the details are public things have cooled down. Not even the news that AAPL is taking a stab at the healthcare market was enough to lift the stock. My sense is that more selloff happens before the tax vote and NDX should stay weaker. Then it won’t.
Same for the VIX as it should stay firm and barring any fake news it will tank into Christmas post Dec 15th. NDX/SPX seems like a nice pair at this point.
Long NDX deltas into the end of the quarter and short SPX deltas just shorter term will do the trick. We will cover the exact set up in Option Pit tomorrow in our Chat Room when we post our Vol Newsletter.
Disclosure: QQQ and SPX trades