A VOLATILITY SLAUGHTER

 

“Hey, I think I found out where volatility disappeared to [or into]!”  

“Well, that de-escalated quickly, didn’t it”? … A call spread signal last night in 

USDCAD, never had a chance … from right after the open, it never moved 

more than a couple dozen PIPs one way or the other, and it ended up 

evaporating into the night, morning and day … I pulled the plug on the trade 

soon after stocks opened on the NYSE … and while I have been generally 

thinking VIX in the stock indices would retreat, I didn’t expect the entire board 

to disappear into a sinkhole! … unquestionably, this is the slowest day since 

September 2018 … there isn’t anything that has moved, with the exception of 

crude oil, which has maintained its “MoJo” and continued today up over $1. 

Directly below, the trade tickets getting in USDCAD @ 45 PIPS.

 

click on to enlarge ALL

  

Directly below, liquidating the trade at just under the halfway mark 

@ 20 PIPS.

 

With CAD not moving at all, and recently mirroring crude oil, I thought 

crude would have good support, which led to buying a binary directly below.

 

When we got the “pop” higher, I liquidated for a gain. Tthat liquidation 

directly below.

 

And while not covering the loss in USDCAD totally, it got back about 

40% - 50%, and given the fact we had no chance in the FX trade, losing about 

12 PIPS [$12 per 1 lot] is acceptable given the fact volatility literally collapsed 

today … “quite frankly, I didn’t see this collapse coming at all … stock indices 

yes, but not everything else … even with President Trump speaking tonight, I 

didn’t think it would effect FX and/or oil at all … it did affect FX, but didn’t with 

oil … go figure … but no matter, cuz the loss is tiny, and if I had been in futures 

or CFD’s, I would have gotten chopped to pieces trying to maintain a position 

… the fact we lost so little with a collapse in FX VIX, tells you everything you 

need to know as to why trading call spreads is one of my favorite derivative 

vehicles to trade at NADEX”.

Onto tomorrow, and we’ll see what’s shakin’ after the open tonight … I’m 

outta here mi amigos … Onward & Upward!

  

Have a great day everybody!

 

-vegas

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