If there’s One Thing I am Sure Of…

It’s to sell short volatility. All of you VIX fanboys are out there popping champagne corks into each other’s face, as the VIX popped due to market decline. Everyone got all panicky and the markets collapsed under the pressure of weak hands and people wanting to protect gains.

But what if the zebra is tempted back at the watering hole? What of the poor zebra?

I imagine we’d enjoy a nice MEAN REVERSION bounce, nothing to serious, but enough to cut off the heads and dicks of those betting on VIX going up any further.

Are we really in a 20s VIX era or something more? I cannot think of a reason why we’d panic up into the 30s or 40s, unless of course the entire country was without gasoline for a few months.

Nevertheless, my position on this market is unchanged. We are stuck in mud. It jumped higher at the open and I profited via my FAS position. But now we’re meandering trading OFF THE HIGHS whilst value stocks are at the highs. Not a good sign. Even still, we could have a weak market and also weak VIX.

For now, I remain mostly cash, testing the waters on the long side.

NOTE: Stocklabs trials are underway. If you received an invite and cannot get in, keep trying. We are trying to resolve issues on our end. If you have any issues logging in, email me at Flybroker at gmail.