Upside Exuberance: From Gamma Squeezes to a Two-Sigma Move

[video_player type=”embed” style=”1″ dimensions=”640×360″ width=”640″ height=”360″ align=”center” margin_top=”0″ margin_bottom=”20″ ipad_color=”black”]PGlmcmFtZSB3aWR0aD0iNjQwIiBoZWlnaHQ9IjM2MCIgc3JjPSJodHRwczovL3d3dy55b3V0dWJlLW5vY29va2llLmNvbS9lbWJlZC9uTVVDSFlyYXc1MD9zaT1Bb19WTThSeDQyWGlCM2xwIiB0aXRsZT0iWW91VHViZSB2aWRlbyBwbGF5ZXIiIGZyYW1lYm9yZGVyPSIwIiBhbGxvdz0iYWNjZWxlcm9tZXRlcjsgYXV0b3BsYXk7IGNsaXBib2FyZC13cml0ZTsgZW5jcnlwdGVkLW1lZGlhOyBneXJvc2NvcGU7IHBpY3R1cmUtaW4tcGljdHVyZTsgd2ViLXNoYXJlIiByZWZlcnJlcnBvbGljeT0ic3RyaWN0LW9yaWdpbi13aGVuLWNyb3NzLW9yaWdpbiIgYWxsb3dmdWxsc2NyZWVuPSIiPjwvaWZyYW1lPg==[/video_player]

We are closing out the week with some fireworks with markets clocking a two-sigma move to the upside, leaving the expected move in the dust.

We were pricing in a 130-handle move in the SPX and got 300. That’s not a rally so much as a mispricing meltdown. It’s upside volatility.

This is happening at a time when gamma squeezes are popping off all over the place – Nvidia, for one. We’re on the verge of a real frenzy in tech, like 2021 all over again. No one cares about fundamentals here.

But here’s the thing. Volatility’s still higher than you’d expect given the vibe out there. That tells us risk hasn’t really gone away, it’s just hiding, pricing all out of whack.

That’s why tonight going deep into the price action. We’ll look at what this upside explosion really means, and how to actually trade it safely…

More from TheoTrade

Why Volatility Fell As Stocks Fell

Wall Street Borrowed Japan’s Money Runs Dry

How Two Lines on a Weekly Chart Called Last Week’s Reversal

The Bond Level Holding Up Everything

How A $38 Risk Paid $230

You Have No Clue Where Oil Goes Next


Most Recent

Why Volatility Fell As Stocks Fell
Wall Street Borrowed Japan’s Money Runs Dry
How Two Lines on a Weekly Chart Called Last Week’s Reversal
The Bond Level Holding Up Everything
How A $38 Risk Paid $230

Get educational market insights sent right to your inbox.

As Seen In