Tom and Dylan debate the risks of centralized government power, particularly under the current administration. Sosnoff argues the U.S. is experiencing unprecedented executive branch consolidation, comparing it to a financial portfolio concentrated in one stock—dangerous when markets reverse. "Bull markets make all money managers look like geniuses," Sosnoff notes, warning that protecting select companies through trade policy creates artificial market conditions that won't withstand downturns. The conversation explores how centralized systems amplify economic risks during downturns, with limited "exits" compared to distributed systems. Sosnoff expresses concern about leadership without proper checks and balances, warning of potentially exaggerated unemployment and inflation during any market correction. Despite these concerns, both acknowledge the massive tech wealth accumulation may provide temporary insulation against immediate economic shock.
Thus market measure explores the relationship between S&P 500 (SPX) and VIX at market tops. Analysis of 35 years of data revealed that 8% of all trading days since 1990 saw the SPX at all-time highs, with two distinct periods of significant occurrences: 1990-2000 and 2014-present. During these market peaks, the median VIX typically runs about four points lower than on regular trading days, with a median of 13.4 across the 30-year period. Since 2014, the median VIX at market highs dropped to 12.8, despite elevated post-COVID volatility. Interestingly, current market conditions appear unusual, with the VIX trading higher than historical patterns would suggest at market peaks. The S&P was up 14 handles during this discussion, with volatility remaining bid.
In the latest "What's Your Assumption?" segment, Tom Sosnoff analyzed viewer trade ideas amid a strong market day with S&P up 25, NASDAQ up 107, and Dow up 250. The team executed multiple trades including shorting GMED stock on valuation concerns, selling JD.com puts ahead of earnings, placing an Adobe put spread with strong IV rank, executing a zero-DTE iron condor on SPX, and selling DOW puts on bullish sentiment. Notable trades included a call ratio spread on BMNR (up 7% on the day), a PLTR calendar spread, bearish Cisco earnings play with naked call sales, and a QQQ put calendar spread. Throughout the segment, Sosnoff also actively managed existing positions, taking profits in NVIDIA shorts and ES futures as markets moved.
In this episode of Options Jive, Tom Sosnoff discusses market volatility, focusing on the S&P 500 and NASDAQ futures. He highlights the significance of the VIX, particularly the one-day and nine-day versions, which react more sharply to market movements compared to the standard 30-day VIX. The conversation delves into the unique signals provided by shorter-term VIX indices, making them valuable for zero-day-to-expiration options trading. Various market volatility indices are also reviewed, underscoring their utility in enhancing trading strategies.
S&P futures up 18.5 points, approaching new highs at 5464.87. Russell leading gains, up 17 points. Bitcoin rebounded above $120,000. Crowdstrike (CRWD) down $14 post-earnings, within expected move. Tom and Tony addressed viewer questions in the "Confirm and Send" segment, covering allocation strategies for zero DTE trades (recommended 1-5% of portfolio), management techniques for strangles, and position handling at 21 DTE. On a PLTR covered call that's $75 in-the-money, the hosts advised closing the position rather than rolling it further. The segment concluded with a discussion on AI's impact on trading, with Sosnoff preparing research showing AI will likely enhance rather than replace trading practices.
Will stock markets really just ignore tariffs and inflation? Markets cheered as Fed rate cut bets survived despite CPI data showing trade policy is boosting prices. tastylive's Head of Global Macro Ilya Spivak breaks down CPI inflation figures showing tariffs are starting to feed into higher prices for consumers, and considers why Wall Street chose to embrace them anyway.
The Overtime team dissects the latest CPI data and its implications for the markets. With the S&P 500 reaching new heights and expectations mounting for a September rate cut, the conversation explores the dynamics of sentiment driving the recent rally.
Markets responded positively to recent inflation data, with the S&P 500 seeing a significant upward movement. Key discussions focused on the AI sector, including Perplexity's offer to Google's and Anthropic's peace offering to the U.S. government for its AI agent Claude. Earnings announcements, notably from CoreWeave (CRWV) and Cava (CAVA), were highlighted as potential trading opportunities. The volatility landscape suggests limited high-volatility trading options with subdued implied volatility across major indices. Traders are encouraged to reassess positions and consider strategic plays as the market evolves.