Hold My Beer

In my Monday post I promised you a volatile week and judging by the past two sessions the market does not intend to disappoint. If you take what historically is already the most volatile week of the entire year, add a heaping of political brinksmanship, a controversial presidential election process, ongoing riots, burning cities, an impending release of classified information by the DOJ, and a healthy dash of good old fashioned MSM hyperbole, then you’ve got yourself a veritable tinderbox of market volatility just waiting to be unleashed.

I for one love it, for volatility means opportunity to get my grubby little hands on even more ill-gotten gains. This may come across as a bit cynical and uncaring. In my defense I would counter that taking any of the flaming train wreck that 2020 has turned into seriously would submit me to a level of mental and emotional hazard I’m unwilling to embrace into my life.

Of course you didn’t come here for cynical diatribes so let’s get on with a bit of charting goodness. Looking at the SPX I see us going nowhere fast as it already ran up to the upper expected price threshold (upper EPT) bounced back, and is currently pushing higher in the early morning session for no apparent reason at all.

My monsters of tech (MOT) composite has been curiously quiet over the past two weeks and although I don’t consider big tech a prime short candidate I cannot help but wonder what implications this may have on the rest of the market.

And once again, it’s not for a lack of trying. Every time I check the OCC report I see tech and automotive related symbols push call to put ratios above 2:1. In the table above, which features yesterday’s closing OCC top 20 stats, I have highlighted all symbols that rank above 65% in the call column.

Which stands in stark contrast to what I’m seeing on the IV front:

Please log in to your RPQ membership in order to view the rest of this post. Not a member yet? Click here to learn more about how Red Pill Quants can help you advance your trading to the next level.

  • Mike
  • 3 years ago

About the Author

Hey there, I am one of the founding members of Red Pill Quants. I used to work as a systems engineer in Silicon Valley until I left the industry in 2008 to become a full time quant trader. It's been fun ever since.