Shave and a Rate Cut
...and that rally, if it happens, will offer the best opportunity to layer into better price points on the short side and lower volatility in option land.
Man, I've traded and faded more in the last three weeks than anytime in recent memory (which perhaps isn't saying much given my A.D.D.-ness). Sometimes right, sometimes wrong, always stressful. Hey, this is the life we've chosen, right?
In the interest of forthright communication, I used the latest downside dip to sell the S&P put "add" from earlier and then some. My position is paltry, relatively speaking, and while I continue to stick my earlier guns, my chips are Pringles compared to the potatoes I've recently been luggin'. I'm tired, it's whippy and quite honestly, I just wanna be hugged. Is that so wrong?
So, lotsa dry powder in these parts as we edge into our requisite respite. Remember, everyone seems to think that we rally into the weekend as that's been the pattern. I don't think so but, again, I've already cashed in most of my chips. I'll simply say this---if we fail, in the face of historic liquidity injections, the table will be set for all sortsa Monday crash talk.
That, in my view, is when the Fed could strike. And that rally, if it happens, will offer the best opportunity to layer into better price points on the short side and lower volatility in option land. Obviously, this is one man's humble opinion so please treat it as such. For if I've learned anything through the years, it's that we must remain humble or the market will do it for us.
May peace be with you.
Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at email@example.com.
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