Today’s action included large volume, big range and a huge spike in volatility. The cause for this move isn’t as important as its effect. The amount of selling through these levels indicates a huge swing to bearish sentiment. With all of today’s action, along with the VIX spiking above 19, we should expect more weakness moving into next week. Don’t be surprised if we get an oversold bounce tomorrow, but unless we retrace back above support levels, it’s nothing more than just that.
August expiration is tomorrow, so make sure to address your portfolios. You may want to double check those bears. Usually, we would suggest taking your time in building positions going into next month; however, today has opened up some bearish opportunities. Make your trades as they confirm, but stay mindful of your overall account exposure.
Mid-Week Outlook
- Bullish: 8%
- Sideways: 32%
- Bearish: 60%
Have a great night,
The Maverick Trading Team
