Not to say the drop was obvious but potential of a drop was high since the recent run up. First signs of cracking were big movers such as TSLA and SPCE which finally settled lower from its recent run ups. I took a quick scalp off of volatility trade once VIX hit 15. This happened around 11:17am. Why long VIX there? VIX was getting an uptick and bounded off a resistance.
Where did I sell out of the trade? Pretty much when VIX went to 16.5 but looking back it was too early since VIX got over to 17. Note at the firs pop in VIX the Dow was down close to 400 points, but Dow recovered from there. Yet it took the VIX another half hour to peak so it shows to me people were surprise by the drop and reacted late to buying premium for insurance to further stock drops.
With this experience I will be prepared for the next "rug pull". Not to say for certain it will come soon, but technical is showing signs. SPY's MACD and RSI is curving down. While VIX price is sloping up. Rather than getting myself trapped on one side I will be waiting for tomorrow's open to see how this all plays out as tomorrow is the monthly expiration.
Posted via Steemleo