The S&P moved 260 points this week against an expected move of 111.
That is about 2.4 standard deviations outside what the options market priced, so I recorded my weekend update on what it means for next week.
Trade is about to get erratic, and the reason has nothing to do with the jobs number.
We breached the volatility box to the upside. All the open interest that normally holds a market together is sitting way back down at 7511.
Up here in never never land, there is almost nothing.
So a couple thousand SPX contracts can move the whole market, because there is no structure to absorb it.
Here is what I cover:
→ Microsoft added $700 billion of market cap this week. Half of it came in one session.
→ The sector suddenly outperforming, and why it does not leave me warm and fuzzy.
→ Where I think semiconductors go from here, plus the bearish position I opened Friday in a name that just ran 30%.
→ The skew reading I would call one of the strangest places you can live in.
→ Why bonds keep selling off even with the Fed on hold, and the level I think the 10-year hits.
PLUS I give you the one number I am watching next week and which side to take. I made the same call last weekend and the market went 260.
Explosive move to the upside, but we are not home yet.
