Wow. Haven’t been trading much after some terrible whipsaw action. Just curious- how many people here think this kind of insane action is a precursor to another 2008/09 style crash? I think it’s a real possibility.
Well… that escalated quickly. Didn’t see this one coming. A move to $42 in UVXY the next 7 days would really hurt me.
Sold UVXY $55 calls expiring next week. If that won’t trigger a market crash, nothing will.
There it was folks- we saw history. Only rate hike we’ll see in the next decade in my opinion. See ya’ll at 2250 S&P.
This week’s lesson for me is, forget about shorting UVXY directly and just buy puts. Not only is it sometimes impossible to borrow shares, during a Fed week the plunge is so severe that no price is too high to pay for puts. If they indicate that today is the end of the tightening cycle, the UVXY $30 puts will end up being a 50 bagger from Monday. Impressive.
Prediction for tomorrow: It looks like another Fed leak. They raise to 0.25 but basically say “we’re not going to raise again for many months.” I have heard some people talk about them raising as high as 2% in 2016, but I still believe after this raise the next move is a cut back to 0 and possibly into negative rates with continuing economic weakness. Not sure if new all time highs will print by year-end but not that unlikely.
Does anyone’s broker have shares of DGAZ to short? Much more liquid than KOLD. Would rather short it than buy UGAZ because of the wicked decay.