Over $20B changed hands in $/ES futures contracts on that 5 minute flush down around 9am CT today after #ISM release. Probably a reversal flush out IMO. Would like to see close above $2930 in ESZ9 before complete reversal back up.

Over $20B changed hands in $/ES futures contracts on that 5 minute flush down around 9am CT today after #ISM release. Probably a reversal flush out IMO. Would like to see close above $2930 in ESZ9 before complete reversal back up. #VIX
— Brian Stutland (@BrianStutland) October 3, 2019

Source: @BrianStutland October 03, 2019 at 01:13PM
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Is the KCJ Foreshadowing a 2008 Repeat?

The CBOE Correlation Index (KCJ) is close to the lowest level we have seen since it was first listed in 2007. The KCJ measures the implied movement of the S&P 500 components options, compared to the implied movement of the S&P 500 index options. Simply put, the higher the number, the more likely all stocks are going to move together. Conversely, a low number will be characterized by sector rotation, and flat markets; one sector moves higher, another moves lower. (Source: Access Hollywood) Correlation, for lack of a better term, is correlated with volatility. Not surprisingly, 30-day S&P 500 historical volatility is near the low level of 6.5%. Currently at 33.5, KCJ is sitting close to rock bottom, lower than where it was in 2007, (but not lower than where Lindsay Lohan was in 2007). So far this year, the market has been able to grind higher, characterized by leadership in FANG(Facebook Apple/Amazon, Netflix, Google) and sector rotation. A...

Can the market start to bottom and move higher when there is so much fear? #EAVOL https://t.co/H3ZzzIviOG

Can the market start to bottom and move higher when there is so much fear? #VIX #EAVOL https://t.co/H3ZzzIviOG — Brian Stutland (@BrianStutland) Sep 15, 2022 Source: @BrianStutland September 15, 2022 at 07:24AM More info Your Website/Page Anchor Text Here

Unusual Options Activity

Yesterday 20,039 EEM September 41.5 calls were bought at the ask for $0.37 and 51,558 EEM Nov. 36 puts were bought at the ask for $0.35. VXEEM, the CBOE Emerging Markets ETF Volatility Index traded down near its 52-week low, and this trade was a bet that volatility is bottoming out and will increase. EEM closed yesterday at 41.68, so the call strike is much closer to the money than the puts. This suggests the trader is also bullish on emerging markets but is protecting himself should there be a strong reversal and a break of support in the 37 area. Yesterday we also saw a lot of call buying in the financial sector as traders made bets banks would rally into November expiration due to Fed easing. On trader bought 38,671 BAC November 10 calls for $0.26. Bank of America’s 52-week high is 10.10, and this trade is a bet that the bank trades higher than that in the coming months. We also saw a trader sell 44,211 XLF Oct. 17 calls and buy 40,000 XLF Nov. 17 calls for a net debit of $0.09. Th...

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