The VXX trade will have to wait, SVIX too

[fstp, logo, header] August 6, 2024 [ag views, logo, header] The VXX trade will have to wait, SVIX too  Traders got complacent with the job growth, Trump win and AI awesomeness. All 3 of those things are now up for grabs as the Fed is stuck trying to get rates lower with insatiable US GOV demand for bonds. Toss is WW3 with Israel and Iran and over short vol funds and this is the mess we got. The VIX Aug futures are going to close near the session highs. In my mind that means this action is not going to stop anytime soon. The VIX Aug future was trading 14.62 two weeks ago and now it is $30.80. There is some serious short covering going on right now. This will be a choppy week. [ded] 2 day VIX chart Once VIX gets up here everyone wants to jump in the short VIX trade like a Proshares Ultra Short Term VIX ETF (Ticker: UVXY) short or a Volatility Shares -1x short VIX futures ETF (Ticker: SVIX) long. The issue is as long as the futures are below VIX cash, UVXY will climb and SVIX will drop. [ded] VIX futures term structure UVXY is decaying upward and .82 per day and SVIX .20 per day. Those are daily penalties if the VIX futures do not drop. We are 3 days into this VIX event. Without the Fed to save things, expect more volatility. - AG  [logo, pit profits] Want to find YOUR winning fit? Give our Customer Care Team a call at [1-888-872-3301](tel:/1-888-872-3301) Monday-Friday from 9 a.m. - 5 p.m. EST. Or email them anytime at [support@optionpit.com](mailto:/support@optionpit.com)  [logo, fvix, header,] State of the Market Meeting  Hey Traders, In today's video, I breakdown what is happening in the market. We'll go over what a carry trade is, and why it hit us so hard. [yt]( [Click here to watch the video!]( - Mark --------------------------------------------------------------- Want to get Mark's Trader's Edge updates directly to your inbox?[Click this link to sign up!](  [frep] The craziest open in 6 years!  Yo Pit Crazies, [With VXX running to near term highs, sign up now for our VXX trade.]( You will want to know when we add it. Nothing like geopolitical risk to toss a match on a pool of gasoline. Traders just about lost their minds this morning with many of the major brokerages not accepting orders. I have to say [Trade Hawk from Tradier and Interactive Brokers]( were both taking trades. Market makers had their own ideas. It recalls the Soup Nazi from Seinfeld back when TV was funny. If the Soup Nazi did not like your order, no soup! This morning when VIX ripped to over 55 making a quick double, no Liquidity Providers in VIX were making anything close to a market and I don’t blame them. [VALL] There was no telling what was going to happen this morning. 3-4% SPX moves are pretty big and the question we all want to know is if it will keep going. After all, the market did not go limit down for the massive spike we had in VIX. Below is a chart of VVIX or the index that uses the VIX methodology. It is the VIX of the VIX. it made a high early Monday morning but feel off before moving back up into the close. [VALL] VVIX 20 day chart What I like about this chart is that it tells how wrong volatility can be sometimes. I don't know about you but it was way wrong. Let’s see what the volatility in the [Barclays iPath Series B Short Term VIX futures ETN (Ticker: VXX)]( - Mark --------------------------------------------------------------- Receive the Option Pit "Ticker of the Week" breakdowns as soon as they are released. [Click this link to sign up!](   [glossary, logo] There are plenty of terms in the trading world that need explaining. The Option Pit Glossary is here to help. Today's phrase is:  Time value - The proportion of an option’s value that is sensitive to time decay. The longer an option has until expiration, the more time value (read: the more expensive) it has. [ftsp] All the Right Options. The Option Pit Team brings more than 150 years of experience to you every day. From the trading pits of Chicago to the world's largest banks to the halls of power in DC -- they've done it all. Now they’re collectively focused on one thing: making YOU a better, more profitable trader. 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