tastylive: What's Your Assumption?

The research team presented several trade strategies focusing on stocks showing potential after recent pullbacks. Shark recommended a skewed iron condor on Micron (MU), positioning bullishly with $20-wide put side and $10-wide call side, noting the stock is about $10 off all-time highs. Gad proposed a calendar spread in Boeing (BA), buying December against January expiration. The stock has pulled back 20-30 points from recent highs with low volatility and maintains a 0.68 correlation to the broader market. Kai suggested an iron fly on Meta (META), taking a slightly bullish position. META has underperformed this year, trading near its starting point around $590 while showing only a 0.3 correlation to the market. The team also discussed potential research on zero-day SPX trades during the final 30 minutes of trading sessions.

The market trended lower with all four major indices down approximately one-third of a percent. Russell 2000 (/RTY) showed the most weakness while the Dow has demonstrated relative strength recently as NASDAQ sells off. Volatility edged up slightly to 19.52. Gold continued its impressive run, climbing $20 to around $42, extending its rally from below $4,000. Silver also showed strength, prompting some profitable scalp trades. Oil gained 58 cents to $59.06, while Bitcoin rose nearly 1% to $102. Earnings reactions included Cisco up 5, Disney down 4, and JD.com up about 50 cents. The hosts discussed VIX options strategies, advising against naked call selling due to volatility expansion risk and recommending defined risk positions instead.

Tasty Live is back with a rapid-fire trading session: a quick intraday Russell–Nasdaq micro-futures pair scalp (+~$160 in under a minute) sets the tone, followed by defined-risk options structures across CRW, CSCO, UBER, SLV, HIMS, INTC, OKLO, and Nat Gas/UNG. The crew leans on liquidity, monthly expirations, and small sizing—especially around earnings—while calling out IV rank realities (low in UBER/HIMS, elevated in INTC) and choosing wider wings/ratios for forgiveness. Highlights include: CSCO short diagonal into earnings, UBER Jan/Dec diagonal (1×2 lean), SLV short stock + short 9-day 47 put, HIMS “stupid” (38/42 call spread + short 36 put), INTC Dec 1×3 call ratio (38 vs. 3×43), OKLO wide 1×2 post-earnings for a small credit, and a compact Nat Gas call credit spread near 30-delta. ETSY is a deliberate pass due to poor risk/reward after a sharp bounce. Bottom line: trade what’s moving, define risk, and keep the pairs trade intraday.

The discussion highlights current market activity, noting the S&P 500's recent rise, with the Dow reaching all-time highs. Volatility is contracting, while Bitcoin (BTC) and Ethereum (ETH) see upward movement. The hosts tackle questions about trading strategies in IRA versus margin accounts, emphasizing the importance of managing risk and using options for leverage. They also explore advice for beginner investors, suggesting the use of synthetic strategies over direct stock purchases to maximize capital efficiency.

This Market Measure segment explored the relationship between theta and vega in options trading, revealing counterintuitive dynamics in high IV environments. Analysis of SPY strangles from 2020 to present demonstrated that high IVR trades benefit from both faster time decay and reduced volatility risk. Key findings showed 16-delta SPY strangles have higher initial theta and lower vega exposure when volatility is elevated. The presenters explained that although selling premium during high volatility seems counterintuitive, these trades benefit from exaggerated fear pricing and positions being farther out-of-the-money.

E-mini S&Ps down 17.5 points after Monday's strong performance, while NASDAQ fell 125 points. Gold continues momentum with a 1% gain, up $28.50, while silver surged over 6-7% recently, trading near $51. Bitcoin retreated to $104,700 after nearly reaching $108,000 overnight. Oil gained 63 cents (1%) to $60.76. During Confirm and Send, Nick and Tony addressed several viewer questions including trade adjustment strategies. They generally avoid converting undefined risk trades to defined risk positions mid-trade, noting defensive adjustments are typically made from losing positions. Regarding bond pricing relationships, it's mentioned the "three tick rule" where approximately three ticks equals a 0.01 change in interest rate yield, with 25 basis points equaling one full point in the futures contract. It is also emphasized that most trades initially showing losses is normal, as market efficiency means fills typically come when positions are slightly unfavorable initially.