The smart money is running scared, and hiding in plain sight.
I was on Schwab Network’s Trading 360 this morning, ahead of Kevin Warsh’s first meeting as Fed Chair (join me live at 2:30pm here), and I put up three live trades.
But the trades only make sense once you see what is happening underneath this tape.
Money is rotating in manic, defensive bursts right now, and a lot of it makes no fundamental sense. Semiconductors had their run, so that box is checked. The monsters of tech are faltering.
So the money is fleeing into a couple of corners of this market and bidding them up for no real reason other than fear. Rates are not even down, and one of these groups is still catching a bid. That is not conviction. That is money management running for cover.
So I built three trades around exactly that.
Two of them lean one way. One of them leans hard the other way, and I will be honest, that one bothered me to put on, because it meant getting bullish on a name already cresting into brand-new all-time highs while the crowd chases it higher.
I named all three on air, gave the direction on each, and laid out the exact spreads, the strikes, the expirations, and the risk. I am not going to retype any of that here. You can watch me build each one myself.
To your success,
Don Kaufman
