---
title: 'The Fed Decision Hits Today | LIVE TRADING'
source: 'https://youtube.com/watch?v=OvsH2P916vA'
video_id: 'OvsH2P916vA'
date: 2026-08-07
duration_sec: 30563
---

# The Fed Decision Hits Today | LIVE TRADING

> Source: [The Fed Decision Hits Today | LIVE TRADING](https://youtube.com/watch?v=OvsH2P916vA)

## Summary

The transcript covers a live trading show on a Fed decision day, focusing on market expectations, trading strategies, and the initial reaction to the Fed's announcement. The hosts and guests analyze the Fed's new chair, Kevin Warsh, and the implications of the Fed's hawkish pivot.

### Key Points

- **Fed Day Expectations** [00:00:22] — The Fed is expected to keep rates unchanged at 3.5%-3.75%, but the market is watching for any hawkish signals from new Fed chair Kevin Warsh.
- **Pre-Fed Trading Strategies** [00:03:53] — The hosts discuss their pre-Fed positioning, with some avoiding trades and others using defined-risk strategies like put spreads and calendars.
- **Bond Market Focus** [00:12:26] — Chris Vecchio highlights the importance of the bond market and the 10-year yield, noting that yields need to stay in check for stocks to breathe.
- **SpaceX Options Trading** [00:18:45] — The hosts discuss SpaceX options, which have seen massive volume and volatility, and consider strategies like selling put spreads.
- **Fed Decision and Hawkish Projections** [05:29:22] — The Fed leaves rates unchanged, but the new Summary of Economic Projections is significantly more hawkish, implying at least one rate hike this year.
- **Market Reaction to Fed** [07:01:44] — The market sells off sharply, with the S&P 500 down over 1%, gold dropping $150, and the dollar strengthening.
- **Warsh's Press Conference and Task Forces** [08:15:08] — Warsh announces five new task forces, including one on inflation, signaling a potential redefinition of the 2% target and a shift away from forward guidance.

## Transcript

June 17th. You're watching Tasty Live. I am Jamal Chandler joined by the lovely Liz Deer King. Good morning, Liz. >> Good morning, Jamal. How are you today? >> I'm fantastic. How you doing? >> You know what? It's a it's a beautiful
>> Yeah, [laughter] right. That's the big thing on the docket today is the Fed meeting. um expected to be no change. We're going to stay at 3.5% to 3.75%. But there's a lot going on. I mean,
>> it's expected to stay, but the CM Fed watch tool says it's only a 99.6% >> Yeah. >> So, in the words of Jim Carrey, you're >> Sounds like there's [laughter] a chance. Very small chance. But we both know
they're not going to do anything. >> You know that I know that. You know see. >> Well, but I I still expect some market activity. I mean, Fed day is always not ne not just about bonds, but like
end up doing something gold and silver. I think I feel like those are the things >> I I agree. And I think it's more about what he says right after the fact. So, I mean, I think it's going to be a moot point with the with the actual move, but
It's his first meeting, so we got to we got to watch the guy. Now, like the the big topic was what color do you think his tie is going to be? >> It's a good question. I know. I um what is it? The purple tie means something.
>> I don't I know the purple tie means something, but I don't know. I don't think that's insane. >> Yeah, neither do I. I'm I'm curious. Uh we got uh uh Well, of course, we got
can probably He can definitely explain. >> Tell us about the ties. He's our He's our Fed Primer person. I got to tell you, >> I hope Chris comes in in a tie. >> Yeah, I don't know. I wouldn't hold on
point this morning. So, uh, one of them either GD or it's a Hill, but if God >> he's definitely wearing a tie. You know, that's going to be our new that's going to be our new marker on Fed days. What color tie is Gad wearing? I
>> Last night I watched uh uh the soccer I watched Argentina versus Algeria. Dude, amazing. >> Come on. I didn't see it. Fill me in. >> I mean, he's he's he's amazing. It was It was amazing watching him like just go
to work. this little dude. I mean, that dude's like 5'6. All of 5'6. Yeah. But >> he's I was talking I was having dinner with some friends last night. We were that like of all the sports stars, I
>> I I've never heard him talk. >> Exactly. Isn't that interesting? He even did a commercial last night where he during the game where he didn't talk. >> It's hilarious. It's hilarious to me. I mean, a global star like that. I don't
>> It's crazy. Yeah. Well, obviously they won three-0 cuz all of them have been >> I really That's the first game I've watched. That was the first game I've watched. Um really hadn't get had a chance to watch that many. So, I'm going
probably watch more as it gets closer, you know, as you get the round more more. >> For sure. For sure. Um did you see that being up? >> Yes, correct. Uh the first positive day
Um >> since I've been doing the I'm sorry this week. >> I know. [laughter] >> I know, right? It's um it's the first day that I've noticed uh that that oil
is posit this this is the reason why I buy the call spreads in oil just in case, you know, and I give myself some time just in case things change a little >> Oh, for sure. >> I mean, well, and any given day, I mean,
it's up a little bit. What is oil up 1% right now? It's nothing, but it's still Yeah, you got to you kind of you got to trade to make money. Otherwise, you >> Yeah, it's a way to take a shot. Um, are you trading anything around this whole
trade anything around the Fed meeting? >> So, you know what? I'm not an around the to be bonds, right? If you're going to do anything around the Fed, it's bonds. think it's going to be a non-event, but I think it's all kind of priced in. So
there's not um not necessarily I I think on Fed days I will not trade versus put on a trade. I know that sounds bad to say but I will avoid maybe doing my S&P trades or I'll avoid doing things that are um or I won't do an earnings trade
shakeup in the market. >> Yeah, that's what So um I was wondering if you wonder if you trade like metals cuz I know you like to trade metals a lot. Metals seem to move a lot on these. Metals are easy for me because I'm a I'm
bullish. >> Yeah. And I don't mean like trade on Fed it for Fed day. I just mean like once Fed day happens if something moves, what would be that thing? I would I would imagine for you it would be like metals
sometimes, right? It depends on what happens with the dollar etc. And then if you want to put on? Like I feel like that's the thing you would watch. >> Hey Jamal, when the metals when the metals dip I buy. How about that? That's
So, I look at as an buying opportunity when they dip, which I know is counter. a lot of people on this network don't have that opinion, but I'm actually I'm actually a permable in metals. Not like I said, not big, not huge. It's always
just going to be a portion of my portfolio cuz I look at that more of So, absolute junkie trader. I trade all day, every day. But the metals I look at more of a portfolio than a trade. Does that make sense? So, I I used to say all the
trading. And I look at my metals position, I'm using my options knowledge sense? >> Definitely makes sense. You always want somehow, some way, shape, or form. >> Yeah, for sure. For sure. For sure.
>> So, what about you? What are you doing? What are you doing around this war day? >> Um, well, to your point, I I'm not trading. There's nothing There's no trade on that I have on the book right now that is specific to that day. I will
now that is specific to that day. I will say um the only thing I did yesterday as were heading in by the very end of the day I did buy a calendar call spread in day I did buy a calendar call spread in S&P long June 18 uh long short uh the
17th so basically short today long tomorrow and it's a $7,600 7600 call spread bought it for 570 um so >> but you did this a couple days ago wait till after this was for after the meeting you did this a couple days ago
thinking about when I did a couple of these last week, remember on the off your super super bear you did in SPX? >> I know. I was going to say, Jamal, if you don't take that off, I'm going to
slap your hand. [laughter] >> You know what's funny? You know whose know what I mean? Like I did like I will definitely put things on for a specific reason and um you know, sort of be like whatever that's the premium and it's I'm
fine with it wherever wherever it may lie. But then like every now and again I head yesterday. It's not a profit until you take it out. And I was like okay almost like you were in my head. Dang it. [laughter]
that profit. Take it. Go buy your friend dinner. mean down 40 points. We haven't really had too many of those. I'm not sure if we're going to get down another 100. Who knows what tomorrow that was my thought
tomorrow. >> I mean I was surprised that we were so soft yesterday. I was really surprised cuz during the show all morning we you bit and then it just slipped. It just literally slid like slowly the rest of
>> It was kind of bizarre. That's why it's for that I don't know how you say this bizarreity. I decided to [laughter] take take it
like why are we down interesting? Let me just take this. slide down and I think we closed on the lows yesterday and I was so looking at >> Yeah. >> And I mean we're relatively unched
across the board at everything and nothing is really moving. You got green screen. >> Yeah. I mean futures are sitting right at 60 uh 7600 right now which is um a good time to get to our real first look
good time to get to our real first look at the markets. Uh the E- mini S&Ps are right around uh just five points under 7,600 at 8 and a quarter. The NASDAQ is 7,600 at 8 and a quarter. The NASDAQ is up 197 points at 30,500. These seem to
be sticking points right now. Um 7600, 30,5 3,000 in the Russell 2000. Right now we're up three points and the Dow I guess at 525 or so somewhere around Dow was the only one that's that's negative today. Yesterday was reversed.
and the Dow was up. Today the Dow's the only one that's negative. kind of weird, right? Y >> but I mean I would say this this is a think we're going to sit here I personally think we're going to sit here
all day until until after wash talks. >> It's very possible. Yeah. Um 10ear yield, by the way, is at 4.4%. Really hasn't moved that much this. >> So yeah, I mean the 10-year yield's at 4.4%. That's a pretty decent return,
risk-free rate. I mean, if you wanted to sit in cash, you can just sit back and earn 4 point what was it? 4.4%. >> And uh yeah, you're right. And by the way, uh VIX options stopped trading
yesterday for June. And uh the VIX future expires this morning. Actually, right about now. I think it was like 7 7:30. I always forgot what time I used actually. Um >> you regulated the big settlement?
>> Yeah, I did. Yeah. In my time in REGG, I got a whole crazy little bit of career, things. I've done some things. But enough about me. Enough about me. you in Market Red? >> I was there. I I'll tell you in a little
somebody. We got to bring in >> the one, the only Chris Veio. We got to bring him in. Chris, what's going on there? [laughter]
So, I'll tell you the Market Ragg story. I worked in market rag 2017 I worked in market rag 2017 um from 2017 to 2019 just about maybe a yeah was my >> So you know I was in market rag as well.
>> Yes. Yes. Yes. Yes. Yes. I was in charge of and then I always laugh about this tall. I was tall down there but I was in charge of the box. So if anybody wanted to um you know exercise or assign something they had till 3:15 to write it
one who's like nope you're done. Like I had to cry. Like I was I was like the security guard for Mar Ray. >> Geez. >> Yeah. Yeah. >> Okay. Now we got Chris Veio on the line.
>> Oh, HE'S WEARING A PURPLE SHIRT. NOT A PURPLE TIE, A purple shirt. So, >> this is uh this is like a a light blue and maybe a flamingo pink.
that. But what what is the deal with the purple tie? Inquiring minds want to >> Yeah. So Powell did that because if people if he wore a blue tie and he said were blue tie, people are going to go, "Oh, he's such a Democrat." And if he
wore a red tie, people would go, "Oh, he's such a Republican." So he wore >> Oh, there you go. Okay. Thank you. Mystery solved. Thank you, Chris Veio. >> Also, you know, people say purple tie, time to buy. So it has a nice rhyme to
>> Has a nice rhyme to it. Yeah. Although truth be told I mean yeah >> tie pie are the rhymes not the purple but whatever [laughter] the tie >> what's going on today man
the markets are in a bit of a holding pattern here AI had a little bit of a a nice bounce in Asian markets that trade so we have NASDAQ leading up overall but to open below 17 ahead of a Fed where
anything I mean I think Wor has a fine line to walk today. Uh the the hawkish case is obvious. CPI, PPI, those are up. Supply chains have been disrupted, but the dovish case is kind of there, too.
The straits reopening. The oil flow is going to resume. The inflation that has to see some relief. So, do you overreact to it? Uh I'm very interested to see Central press conference more so than the actual rate decision itself. That's
>> That's that's what we were talking about, too. I mean, I I agree with you. kind of going to move the markets >> and it's his first meeting so people are >> Yeah. Yeah. >> What I'll
>> Yeah. Go ahead. Sorry, Liz. I >> I'm keeping an eye on the bond market. I mean, bond market's in charge today. Um at the end of the day, the market needs going to allow inflation to spiral out of control, nor is it going to allow the
economy to overheat or melt down. So to that end, stability in the long end of the yield curve uh in the 10ens in particular, keep that below 4.5%. and that to me is the only thing that matters. Yields need to stay in check
today. If yields stay in check today, stocks can continue to breathe. looking at those yields, looking at bonds. I don't know how much I'll trade quite some time. and volatility's been fairly low in these um over the last
fairly low in these um over the last couple of weeks and um really um they've returned to being kind of quiet. You know, we've seen some interesting years >> The V is gone, >> but where we find ourselves today,
>> but where we find ourselves today, right, in ZN and ZB, uh tens and 30s, average. Uh and so we're do we're meeting this 50-day moving average, this if the downtrend remains or we turn a corner right with the Fed. So catalyst
meet your technical level is kind of picture perfect. I would watch to see if there 50-day today. That's a pretty strong sign that the market feels confident the Fed is not going to allow inflation to spiral out of control. I
24 as a good framework here. The Fed cuts 50 basis points and then yields shoot higher because the market views it as reflationary. So that's the trick the market goes oh inflation's going to spiral. yields are going to, you know,
to cause a lot of angst in a lot of different places. So that's it. Block the fine line, Mr. Walsh. Don't be too hawkish, too doubbish. Give us your we'll be we'll be golden. >> Yeah, ju just right. Okay. So, Chris,
know you're keeping an eye on the bonds, but what are you using to trade? Are you futures options or do you use TLT? >> You know, I I really like using the futures options in particular in ZN. ZN is actually a better product for retail
overnight buying requirement, half the tick value. Um, and so, you know, it's like the liquidity of futures. Like, right now, you can't you're not trading TLT right now >> in any meaningful way. Um, because it's
it's an ETF. So, I'd prefer to use the liquidity of the futures market around options because I'm going to stay defined risk around big macro events. neutral here? Are you doing a defined risk? Like, what what is what is Chris
Beckio pressing the button on today? I think that this is a my concern here. So this is not just about the position on bonds. Jamal always points out u during that together it was what do you do to bring down the beta weighted deltas of
here that could reduce the correlations of what's already in this mix? And so because I'm already leaning long deltas in some software names, in some chip in some software names, in some chip names, in the indexes, in NASDAQ, uh
words, not to put words in your mouth, but wasn't it all tech no breaks for a >> It has been and it has been for the past few months. So what would disrupt that rally? A bump in yields, right? That would cause this long duration scare, if
you will. So in my view, what I want to do here is get short deltas in bonds and notes if I'm going to do that today, which I'm eyeing up some trades here. I think it might just be something like a long um out of the money put spread as a
stocks come in, but at least I'll have something that gives me a little bit of convexity on the bond side. Otherwise, it'll be cheap insurance risking one to doesn't work out, it probably means the stock stuff is still working and I'm
scenario either way. >> Yeah. And I I actually love that you're When I'm looking at this, the ranks are so low. So, you wouldn't be selling an you're getting short delta, that's the way to do it. I like it.
here. >> 52 points. 52 in the orders are just almost uh points expected move today in S&P. So, not a whole lot is expected at plenty of days where >> there's a certain expected move and we
completely exceed that by one or two times. So, anything could happen. >> Anything could happen. It is uh a little bit more volatility anticipated than the last Fed meeting. If I recall correctly, the final Fed meeting under Powell, the
implied move was like 36 points day of. So, the market is expecting that there's um you know, there's some greater tale here. We may see a little bit more session. That should be expected. Again, it's his first meeting and we got to
watch the tone that he sets here. Um I think was that May 18? >> Yeah. Right. I think it's right here. Yeah. This is the big one day right here. >> May 20 May 20th is when the uh palace
>> Chris, it's amazing that you have these dates just seared into your memory. If date >> really not [laughter] I could, Liz, it could be filled with poetry and music and art and instead
filled with meaningless numbers. >> I know that before, too. I I you have to your brain. I have all these different years and I used to I used to I still kind of remember a lot of dates of like like famous people from when I was young
in my head all the time. Useless knowledge. Like zero useless. >> Okay. >> Chris's dates are useless are useful. [laughter] Those are useless. >> I know. and just, you know,
dishes, but like Nelly's Country grammar, that entire album is definitely like stored in the memory of this 25 years. >> Why do I still need that? >> Yeah. I don't know. They're not
>> Yeah. I don't know. They're not [laughter] big fat nothing burger, right? You just never know with these Fed days, but uh some movement with regardless of the Fed, there's going to be some movement,
I would think, at some point in time, like you said, after um it might be slow for a little bit heading into the meeting itself at uh 2:00 p.m. Eastern, 1:00 p.m. Central time, and then we might get a little bit more activity
later. But um I guess we'll just have to see how this thing goes down. >> They And SpaceX got a bunch of new options today, too. So, they added even more today than they had yesterday. And it was weird because I don't know why
look at that? Look at those. You can see the ones that are in me. Nothing but I felt like I talked SpaceX options all day yesterday, but I'm I mean I now I'm mentioned I do have a couple of position. I did put on some calendar
mean, SpaceX, SpaceX, SpaceX, dude, are you kidding me? [laughter] >> 112 days to expiration. It officially >> Officially took over Amazon. Now it's coming from Microsoft. It's
really like trading IPOs, the days themselves, but I' I've dipped my toe in the water here. I'm looking short the one standard deviation um put spread right now at 1 DTE here. This is the market right now, right? We we've seen
is the number one ticker that people are trading. In fact, SpaceX volumes have been so large, they've equal the rest of the entire market combined, >> as it were. So I I feel like you just have to have some skin in the game right
like we're looking at a little bit of a financial engineering bounce. So being short the 180 185 put spread to me works. It's front risking right now it's risking one to or rather four to make one about an
85% probability of profit. When I put on yesterday it was closer to a 3:1. Uh, and for the time being until we get through this lockup window in August, I that regard. >> I love this. I love that. Yeah,
but you know what I think happened? I'm trying to check a different account. Um, because I think the margin has has come back to it, right? If you throw in just >> Yeah. >> Um,
>> Um, >> yeah, it's not cash. It was like 11,000. Today is margin. Every Y yesterday everything was cash secured and today you can use margin. So, woo. [laughter] >> Yeah, a little bit better than it was
before you couldn't. It was like trading IRA. did some calls and put spreads yesterday. Um, so long SE short August. So, that's kind of my place right now um to with around expected moves. But good
We got to bring in uh TP. We got to let you go and bring in TP himself, the man. TP from Austin. TP, what's going on? TP from Austin. TP, what's going on? >> And there he is. Hi TP.
>> Amazing. How are you? >> Very quiet morning in the market. >> For the time being, right? Yeah, it >> Um, >> okay. So, um, you know, everybody's, uh,
waiting for this, um, uh, this FOMC meeting and this stuff like that. I think it's going to be nothing's going to happen. And, um, but I just want your guys take this. Um, this is probably going to be the most politically
inclined um, Fed we've ever seen. And I'm not Whatever. Whatever your your persuasion is, doesn't matter. It's that's why I think rather than the actual decision, this is going to be they're going to
focus on the minutes um about how you know what stance for either raising or next year or so. And I personally I think they're going to lean towards >> So, it's pretty funny. All three of us have or all four of us are now in
be what what happens. I think it's going to be what he says, right? >> for sure. >> It's exactly right. And you know, everybody watching, Liz, Jamal, and I were talking yesterday about uh bonds
and taking a look at maybe a bond trade ahead of this, and I want to show you ahead of this, and I want to show you something very, very particular. Um, you know, it's Liz's middle name is Broken Wing Butterfly.
>> I thought it was another child that would name it would name it >> if she did. If she did. and and so it's you know hey TP can you find a broken so let's let's just take a look if we can
um >> let's look at ZN/ZN >> okay >> why am I looking at that because the way the way I see it is the ZN options are a little bit richer a little bit higher
premium than the bonds that's but that's I don't want to get into that right now but go open up the the 23 let's open up the 37day a options. Just just pick pick
an expiration and let's create a butterfly. So, and here's here's the issue that I'm running into. Let's buy the 109 let's buy the 10950 puts. So, buy those for 29 cents. Let's sell two of the 108 halves.
Sell two of those and buy one of the 107 halves. That creates our butterfly. And then drag it drag that 107 half put down to the 107 half down to the 107s. very small numbers. What is the price of the regular butterfly? And then what are
you collecting? So what how much were you paying for the the butterfly? >> 10 tick. >> 10 $23 in buying power. >> Uh take it down to 107 asking one to make seven.
>> Yeah. Take it down to 107. Nine. Nine ticks. Take it down to one. Take it down to 106 half eight debit. Take it down to 106.
debit. You should be a credit, right? >> No, it's a debit. >> That's the problem >> is bond volatility, bond and note volatility have been dropping. They're rel they're both relatively low. ZN is a
little bit higher than bonds. So that's why I'm looking at ZN. But the point is why I'm looking at ZN. But the point is in low volatility products these can be >> they can be tough. You could you could narrow your you could narrow the top. So
you could take the >> Sure. I mean you >> Yeah. I mean go ahead. You narrow it to change it to the 109 half 109 or the you >> Yeah. You got you got to squeeze those together. So take the take it uh the
the top. on the top. >> How do I? >> No. No. >> Yeah. Like buy the buy the 109 put. Sell two 108 half and a half. Take squeeze those. Take make them tighter. There you
risking way more now. >> You're risking Yeah. You're risking a lot more because then you don't profile >> and and that's the point. So it's >> right? >> And if they don't set up your mouth
saying, I don't force them. I take my ball and go play somewhere else. Yeah. >> Right. >> So, it's either So, it's either Okay. If I have talked about this for years. Just cuz I like broken wing butterflies, and
them. Um, but just because you like then when you open it up, it doesn't work. I I love what you're saying because just cuz you like them, you can't force it in.
>> It's exactly right. >> And it's [clears throat] the options give you flexibility. Correct. use the flexibility. If you want to be bullish on bonds or notes, you know, either 30-year ZBS or ZNS,
you can go and sell a put spread maybe in ZN. Jamal, let's take a look at let's just take a look at put spread straight up short put spreads in ZN because and put is the margin requirements are just too high for for for a lot of folks.
It's not not practical. So, we just go in there and maybe sell the 109 108 put spread. See what credit we get for that. >> Yep. We get uh 12 ticks of credit. Max
profit 187 and a half risking uh basically seven to make one. >> Yeah, it's and you know, not great because like I said, bond volatility was dropping, but it does give you some positive theta. Um that is a simpler
trade. I don't love that trade either because again like Jal was saying risking seven to make one even pulling that up one strike really doesn't get that up one strike really doesn't get get you much more. Um and you know I'm
get you much more. Um and you know I'm in it's trading bonds like this ahead of this number. I just don't see a lot of short premium strategies in here that are attractive even buying buying call spreads. I hate the negative theta.
>> I hate the negative 17 rank. I would almost consider then >> I would almost I would almost Well, here's the real thing. What we're really talking about here like like TP has said a bunch multiple times how how uh V is
really low. But let's really talk about the implied V itself. This is single digits 4.9, right? So even if you sell this, how much lower is it going to come going to get two? >> Well, because that's that's note
volatility, right? That's note volatility. It's like five, you know. Yeah. >> And so it's it's so that's why I would >> Yep. >> I think they're going to rally them. I
>> I think they're going to rally them. I think [snorts] it's I you know the the and here's here's the point. I sold my iron condor yesterday and Liz and I always fight about which strikes we pick for our SPX iron condor. I go quieter,
she goes closer in. But I was able to take mine off for 50% profit in two take mine off for 50% profit in two hours, a little over two hours. It had, you know, before they sold off and all that stuff. And I'm just going to go to
the well again today. Um, >> and I thought I thought about you far far away. I think about you every day, TP, but [laughter] your strikes were so far away. >> I got to be I don't owe Liz money. I
promise, folks. I don't owe her money. But so your strikes were so far away. sliding, I figured you would still be okay even if you didn't get out for 50%. been completely out of the money at the end of the day because of your strike
>> I had did not >> I had enough room. I had enough room and but it didn't really matter because I don't you know I take them off just because it's the it's the mechanics of that strategy. Let's let's open up Z uh
S&P options and see what we're doing here. Heck, let's open up ES options. So, it's the same concept and now you can close everything. >> To that end, there are there different reasons you choose ES options at times
over uh S&P options and vice versa. >> Mainly because mainly because right now I can actually execute um uh ES options. I don't think I don't think the S&P during >> day it's 8:00 and and the reason is the
the the all the whole pattern day trading stuff that's gone. I may not have a futures account. Also, the tick smaller, right? >> So, the credits you the actual dollars
you take in is less than an S&P trade. I mean, yeah, you can widen it out, but if I sell this u let's say um yeah, if I I sell this u let's say um yeah, if I sell that put spread, it's
>> Yeah, it's what $50 a point as opposed to $100 a point. So, it's just less credit. It's just less credit. >> It's And the markets are are decent in here. Yeah. Let's just sell that for a buck 75. See what we get.
>> Bam. Immediate fillage. Very liquid. >> Take a fill. Yeah, these things trade. And so that's that's how I would be biased towards this FOMC meeting if I
just going to look at the S&PS and I think they're going to rally them up >> Yeah, I think you're right, too. >> I like that you can trade when you know it's not 8:30 yet. It's 8:00 and you can always get in the futures options.
>> Available. >> The other the other point is too guys, is we can also look at the currencies. So, if you think that rates are going to go nowhere and that might be, you know, bearish on the dollar, you could buy the
yen here. You could buy the euro here. Um, but again, the um the premiums just aren't that that high for the broken wing butterflies. Let's open up J. Um yeah, let's look at the the Japanese yen options with let's go 15 days. and see
options with let's go 15 days. and see what they look like. And you know, buy what they look like. And you know, buy let's do the same exercise. Buy the 6275 let's do the same exercise. Buy the 6275 put.
Yeah, that one. Sell the 225 put two times Yeah, the 61 75. Okay, that gives me a an 11 debit. And drag that 6175 down to
See what I get. >> Yeah. >> As somebody who's done this, it's very hard to do in the end. You're never >> Because it's it's almost impossible to do broken wing butterflies in the end.
>> It's the same thing. And so what you do is when Liz says it's almost impossible to do this in the yen because she's looked at this a thousand times. Okay? And you try to do this and this exercise it's not work. It doesn't work. Right?
So the yen I would go back to I would just go back to forget the broken wing butterflies. Remember broken wing butterfly is a butterfly plus a short short out of the money put vertical. On the call side it's an out of the money
call vertical. Just focus on the call vertical part or the put vertical part. If you're bullish on yen which I am. I'm selling put spreads in yen today. there's a there's a couple things you could do. I know um Jamal went to F you
could always do that, too. You could trade the FX markets. I prefer >> I prefer the options in in 6J. I'm kind of with UTP, an old school trader. you just want to take an outright make an outright bet on a currency to buy it
in the in the forex market. That's awesome. And it's a great way to understand the mechanics, excuse me, [clears throat] of that market with the overnight rolls and the the adjustments to it like that. But the bottom line is
just for pure trading. I'm an option trader. If it's it's, you know, yeah, I mean, okay, I I might take a shot on a currency, but my bread and butter is doing option trades. And that's why, like Liz just said, if I'm going to make
a speculation on a currency, I'm going to the futures options first. You want to be wrong, right, with the options, you're giving yourself a little bit of room. >> 100% 100%. And I can manage it and and
day, get a little bit of theta, things like that. I mean, yeah, you know, we've talked to um Mike Butler about this last week, you know, trading the trading the Swiss Frank. It's Yeah, if you look at
the interest rate differentials between the cartre, you can you can earn that the cartre, you can you can earn that carry between them on an FX trade. But to me, that's that's not so much a strategy. It's a nice part, but really,
you're still making taking so much you you you're making a directional bet on coming from. >> Yeah. It's it's direct exposure a lot of example, versus doing that cross, whatever, dollar yen cross sometimes. I
in ways that you don't even imagine. you're not you're not used to it versus one of those currencies is probably a little easier to do. SpaceX doing right now? >> It was up a couple of bucks.
>> Breaking news from an option trader to an option trader. It's margin now. >> no way. >> Yes. Yes. >> I'm I'm still not selling naked puts in there, Liz. [laughter] It's No, cuz it's
regular margins, it's just too steep. And the other thing too, you know, it's And the other thing too, you know, it's remember, okay, this is for coming from the guy that built all these margining systems. The the brokerage firm, the the
the margins you see are minimum numbers. Brokers can raise the margins to whatever they think they need to be. Okay? So, it's what what what the FINRA and the SEC and the Treasury Department send out are minimum numbers. So, but if
the broker says, I don't like Liz Deerking's kind of play, you know, she's taking way too much here, they're going to increase the margin requirements, and that could very well happen on SpaceX. >> And just kind just kind of clarify that
change there's a minimum requirement, but they can always make it more broker >> Yes. Yes. Yeah. Hey, so what's the what's the what's the pre-market to SpaceX? Cuz I'm I sold some put spread put spreads yesterday.
>> Yeah. It's uh it's uh 209 and a quarter right now. It's up a few bucks. up again about. All right. So, I'm okay. I'm okay. I sold two day put spreads in there because I want to play. I want to be like the cool kids trading SpaceX.
>> but again, I'm not selling and I don't care what the margin is. I'm not selling naked naked options in there. It's just it's not worth it. But the volatility has um Yeah, it's gone up a little bit. Go open up the two-day options, Jamal,
>> Yep. It was like 27 >> 179. So that's down a little bit. And granted, the options aren't open yet, but it was like 211 215 yesterday, the overall IV in SpaceX options. So you're getting rewarded for taking risk. That's
what volatility is, folks. It's that's what implied volatility is. We looked at it in bonds. Didn't see it in bonds. Didn't see it in notes. Didn't see it in the end. We weren't being rewarded for taking risk. SpaceX, you're being
options. >> I mean, you are, but this thing is 100 V to come in. It's going to be some time. I mean, when you look at like AS [clears throat] and Rocket Lab, those things have stayed at 100 plus V. They
really haven't come in a whole lot. So, I wonder at at what point does how much V comes in, if at all. None. >> Clearly, volatility for space is 100. >> None. and TP, we got a question, Jerma, and I got a question yesterday being
like, um, how and I I I'm asking because you're a volatility expert and has have created a lot of the models. You, if you notice, there's no IVR right there. When um when do when will that come out? How many days need to trade in order for
or not SpaceX volatility is high for itself? the I don't so I don't know what the de dev team has actually coded for the hard in other words if they've added
some flexibility but what the IV rank number does is look at the past year of data 52 weeks looks at the high value the 52- week high value 52- week low value for the IVs and see where current volatility is in that range and right
now with only 3 days of data you don't have you don't have a year's worth so I don't think We're going to have it until next June. That that would be my vote. >> Really? Okay. >> Unless Unless the dev team makes some um
>> And even then, Liz, it doesn't matter. The IV rank doesn't matter. When you when you get 200% volatility, the IV rank doesn't matter. When you've got that high implied volatility, the IVR kind of gets thrown.
>> Yeah. Agreed. >> Yeah. I mean, boy, that's uh Yeah, like what, as Liz astutely noted this morning, too, they got more options expirations October and November here now, as well as February and March of
next year. So, um, and December of next year. So, just >> all sorts of ways of blowing yourself up. [laughter] we're going to take a quick little break here. Markets are kind of flat right
now, just under 7,600 on the E- Mini. S&P's up four and a half. NASDAQ up 155 points, the Russell up 8 80 cents if [clears throat] you will, and the Dow Opposite of yesterday. We're going to take a quick 90 second break. We'll be
take a quick 90 second break. We'll be right back. You're watching Tasty Live. manager here at Tasty Trade and I just qualified for the World Poker Tour $5
million free roll um in Las Vegas on Friday. So, I've been playing poker for about 20 years, actually. I started just with friends. It was like 2005, I think it was, where everybody was like, "Yes, let's go play poker." There was a huge
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doing the math, you're reading the people, and you're doing all of those things in combination with each other. So that way, you're using all the tools So that way, you're using all the tools that are available [music] to you.
going on everybody? Welcome back. [laughter] You're watching TC Live. I'm Jamal Chandler sees Liz Deer King. Errol is in doing today? What's going on, Liz? Good to see you guys again.
>> What's going on? >> Um, nothing. I was walking in here. I me, Laura, Chuck, Matt, all them. I know they're like, "Look at this Target manager walking over here." [laughter] >> So,
minutes towards market open. I know we got CPI later on today. So, expecting a guys' mind? >> I mean, we're all watching out for the happens there. Obviously, paying attention to uh the next second day of
watching just all those kind of things. >> Did you guys dabble in any of the uh dropped. >> Yeah, I did a couple of spreads. I did um a couple of calendar spreads, calls, and puts uh just to kind of have
like Liz says, it's if you don't have a position on it, how you going to keep an >> Yeah, it's a great point. >> Yeah. And you have to have a position. I party this weekend, which I'm sure I'm sure you are, Errol. You're going to a
cocktail party this weekend, you have to be able to talk SpaceX options. I mean, you don't if you're not in SpaceX. >> No, it's a good point. And I know Liz, it keeps you up to date with what's going on. And then also, you can kind of
personality, you know, of that specific underlying, too. So, I'm sure as time goes on, you get a little bit better of a feel for how SpaceX trades itself. So, >> Yeah. I mean, the biggest proxy up until this point was looking at AS and Rocket
paying as much attention to those now. It's easier to just pay attention to >> What are those doing? Did they Did those go down, Jamal? When SpaceX >> they did, actually. Um, so you remember I had the two positions. I had one that
had a uh Super Bowl and one that had a Super Bear. Took the Super Bear off, kept the Super Bowl on, and the Super Bowl is an AS, but it's done nothing but >> Yeah. >> See,
airs coming out of these names. I know AS kind of topping out around >> 133 now trading at 82 bucks. Um so I mean some of these are kind of getting dramatic, but they're definitely pulling back since SpaceX is
it's done nothing but trade lower since then. >> And Rocket Lab, let's see, similar deal kind of the same thing. Yeah. Same same almost identical chart just took the prices away. They look the same. Yeah.
need a proxy if you can use the real thing now? So that and that was kind of >> Yeah, it seems. So >> yeah, it seems so. Um >> when we talk about Fed days, usually there's a lot of different things
moving. Sometimes it's markets, sometimes it's um it's it's metals. it's it's bonds. Which of those maybe sometimes it's oil. Maybe on a day like those are you has your attention the most? You know, to be honest, just
because of the trajectory that oil's been on over the last few days on a of oil, but with the velocity and the range to the downside it's been putting in on such a short time frame, a little bit of long delta has been attractive
out, I think I'm going to still be looking at USO. Uh, one of my favorite products, pretty liquid, solid uh liquid options as well on on the USO product. So, maybe a little bit of long delta. And then for the broader market, I have
spreads uh on uh I'm I'm not the biggest of the out- of- the money call options we sold. So 31 days left to expiration, sold the 755s, sitting around break even right now. So uh it it'll be nice to
just hold a little bit of the the indexes through an event like this and delta. So not doing anything in the broader market. clarify, you you're talking about the the the FOMC today, right? CPI. Yeah.
>> I just want I just wanted to clarify that because that's so you're you're looking at oil as a proxy to trade something through through today's >> Yeah, 100%. It'll be interesting just to see when uh when the decision comes out
there's any volatility in there, the direction it goes. It'll just be it'll just be interesting to see how it's correlated or inverse correlated hits today. So >> yeah, I got you. See what those alos do.
statement itself well yeah the statement itself is going to hit at uh 1:00 p.m. central 2 p.m. Eastern and then >> half hour later he comes on and talks more. Well >> at least in the past very first meeting
>> I think he's going to catch a lot of strays. Uh I think he's in a very uh unintentionally you know drone pal brought a lot of attention to that to it's going to be interesting how people kind of pick apart the things that he's
wearing. Oh he's wearing this color tie today. Yeah. that position, I think, is going to be interesting to see how he's um kind of public, but it'll be interesting to see the public's reaction based off of the
it. This is big for you. This is like the first time this is the first change in Fed chair you've been trading. Huh. >> 100%. It's like it's like, you know, for you, you know, like when you're growing up, you think of the president
in. This is different. This is this is the first time um again before inflation started going crazy or I guess I guess uh COVID 2020 whenever we had the market that was the first time I really started honing in on interest rates what they
are uh how the market responds to them who who who talks about CPI day all those kind of things. So 2020 2019 2020 when the market crashed that's what closer. So >> it is my it is a it is a a first for me
>> are you guys going to are you guys going to listen to the minutes or do you just >> I usually just plug into Twitter. What do you I usually plug into Twitter like of see what see what goes on. >> Yeah, that's probably what I'll do, man.
I'll watch the whole thing. It just again, you could tell the market was depending on what was going to happen and come out of the Fed. I don't feel So, I don't know. I I'll just probably watch my Twitter feed, which people have
kind of seen uh now a little bit when I Twitter and like I have my whole setup. cuz for me that's like the biggest sentiment indicator. I can just see they'll come out in order of kind of importance honestly.
>> It is interesting though because it's kind of whatever the whatever he says going to react how the market's going to react. And I think that after after we possibly could, it doesn't re I mean it matters what they say. It does matter
what they say, but the market could react violently in one direction or the we'll see. It'll be an interesting day. more hands-off, Liz, uh prior to an an announcement like this and then maybe do
reaction looks like afterwards or how do you kind of position that? I will do because you don't know if it's going to move or not move. So, I'll kind meeting. I mean, if there's we don't have any earnings on deck or anything
like that, but what I will avoid is trying to do to to do earnings trades or anything that is really binary until you get to see what the market's actually going to do and then you can kind of trade. I look at it I look at it as an
are in my, you know, my more investment portfolio that are down, I'll look at it as buying the dip and things of that nature. So, I mean, I do kind of sit on of SpaceX options today because I don't think that's really going to move on
this news, but who knows? Yeah, who knows, right? Yeah, it really depends. making another move to the upside. It's been nothing but green bars in SpaceX.
>> Literally going to the moon, I guess, is >> I haven't traded it yet today. So, or I haven't traded it yet since the options even dropped. So, I I got to uh uh I got >> Got to have some cocktail. >> I got I got to be able to say I traded
got to be able to say that. [laughter] So, I'll keep you guys posted. You >> I didn't. I mean, I was watching it. I debated on buying some of the shares, can know. We got the Fed meeting." Maybe it was an excuse that I had given
the Fed meeting tomorrow, FOMC 1 central. Uh, I'll be patient and wait first week where we have options. Uh, I'll keep you guys posted on what we do in there and how we manage the risk. So, >> nice. Love it, man. Love it. Um,
>> Pleasure as always. >> As always, man. Great to see you, man. Uh we're going to take a quick break here. E- mini S&P starting to move a little bit higher to the upside. 11 and a quarter just under 7,600. 30,500 on
the NASDAQ up 194 points. Russell up four points to 269 2967, excuse me. And four points to 269 2967, excuse me. And the Dow 52400 down on the day. You're watching Tasty Live. We're going to take a quick 90 second break.
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to Stacy Live. It's the opening bell just around the corner. Markets are up just around the corner. Markets are up right now. Uh 76 75.97, excuse me. 75.97 on the E- Mini S&Ps up. >> Did we have a number come out this
>> We had retail sales at 7:30. >> Retail sales. It didn't move any talk retail sales. >> I mean, I don't think retail sales move are up 10. I >> I think it has the potential. I mean, I
I didn't look at the number at all, but it's an interesting read through, right? If the uh if the consumer is able to withstand the current environment of inflation, that's the question, right? Um, excuse me. Take a quick
and didn't even >> my coffee that our producer Gabby got for me. Thank you so much, Gabby. >> Gabby's getting your coffee now. >> I mean, she [laughter] looked it up. >> That's amazing. That's amazing. Is it
>> No, that that thing's gone. You know that? That thing's been gone. That thing's gone. Yeah. Don't know exactly why. I was. I'm not sure. I don't know why he left, but he left. I think he owns a
>> Yeah. >> But ever traveling. can we take a look at something? Did you put that natural gas position in >> Which natural gas position? >> We did it with TP where we did a
natural gas. >> Oh, yeah. I remember that. Um, where's not. >> You didn't get filled. Okay. I just of it. >> Where what are we talking about? What
>> So it was the it was the >> first July. It was in Yeah, it was in that natural gas is down and that's what you kind of like with the broken wing another one on. But >> I don't have one on. Tell me.
>> So I go to the expected move. So go I I do mine a little bit differently. Sell sell two 2.8s. >> Okay. >> And buy one 2.5. Sell 220 by one.
>> I'm sorry. 2 2.85. You're right there. So, >> you're selling two of two of these. >> I said 2.5. So, sell sell two 2.8s and buy one 2.85. >> Oh, okay. Gotcha.
>> Yeah. Up above it. And so, what's the credit there? credit there? >> That is uh a credit of 40 cents. >> That is uh a credit of 40 cents. >> Okay. And then buy 1270.
So seven cent credit. >> 7- cent credit which is $70. You can sh them. Jamal, I mean, you should see my positions in natural gas. It's just like like, [laughter] >> where's this?
>> But like I said, this is a big product, a very big product. And I will usually do the the ratio spreads. So if you um if you delete that 2.7, I just want to breaking, >> delete that leg. We're long one of the
280 285s and short two of the 280s. >> Yes. So, this is my go-to move in here where I can handle natural gas in in this. But, but when I look at this, so if I do this naked, right? So, I've got
a n I got one naked natural gas position and I understand that that's a lot of risk. And then I will immediately go in after I get filled on this and put an order in to buy the 2.75 after the fact for what are we taking in here? 40 cents
>> Yes. I'll I'll put an order in to buy it for 30 cents. And so then I'll have completed the butterfly locking in $100. >> Okay. naked option in natural gas. But with the show accounts because they had been
always have to break the wing because that was also that was also a good way to do it. >> You you taking a credit? It's kind of to go down because I've seen this. You can let them go, Jamal. That's what my
just let it go until the end. A lot of times I'll have butterfly butterfly butterfly butterfly butterfly and as Mikey the Polish warrior would say on on where you want natural gas to land to land.
peak peak. >> I'm going to try and just I'm going to do this broken wing butterfly 285 short two of the 280s and and I'm going to buy >> Yeah. >> Collect 20 cents. We'll see if we can
>> I mean 20 cents which is crazy in natural gas is $200. Okay. just to kind It's a bigger product, but >> I like it. >> Yeah, it's true. I like it, too. I like those. I don't do those as much. Um
>> Yeah, you know. Yeah, you're right. Uh I I know there's people who do a lot of like say we're moving to the downside in SPX and you'll do that broken wing then you're able to roll the longer leg that's spread out and um basically have
>> butterfly. So >> a free butterfly which is which or free or a butterfly for a credit. So a lot of times we would have done that too in we're up I would do an upside broken wing butterfly. Then if it continues to
go up, great. And if we're down, I'll do a downside broken wing butterfly. If it then I try to lock it in for a profit on the other sides. we're trading like Liz. >> I like them. I like them in big
Look at them. It's very hard to do in the yen. It's very hard to do in in volatility like that, you almost need a bigger product. honestly, just showing you how uh I I mean I think it's a great point. Look,
Don't necessarily have to force it trade in something just because of the catalyst or what's going on, right? Like there's other things to do, but those that strategy doesn't work in those products because the volatility is too
Honestly, that that's that I think that's fair. always works and I almost always do it to the downside. If we get if we're if >> Yeah. >> Um but we got the markets are going to
open in about 30 seconds. We Let's Let's look at SpaceX options. I want to see when they open. >> Yeah, good qu good point. October. Uh when you know I I know that um I've heard rumors that they might not uh do
And I was talking about this with Chris yesterday. They're not going to do will put up on their website um that kind of thing. Markets are open. S&P 500 kind of been sitting here all morning, sitting hovering right around 7,600.
Same thing with NASDAQ hovering around 30,500. Similar with uh the Russell hovering close to 3,52,400 is your Dow. All of them are positive at around. This is going to be that kind of day. SpaceX up eight points here, Liz.
SpaceX up eight. Wow. It's another It's another day. Another up day. Yeah. >> Is this is this rally gonna hold in SpaceX? Are we gonna have four green >> I think it depends on the market today, too. If we somehow turn around after the
fall as well. That's kind of what started happening yesterday. As much as it was up, it went up as high as 225 and then we faded throughout the day and it about that?
It's It's already in the NASDAQ, which is kind of crazy. Bitcoin is down today, thing. So, all crypto >> 750. Yeah, all the cryptos are down. Uh, >> 750. Yeah, all the cryptos are down. Uh, I bit surely down
the percent. Um, kind of long this thing in here. Kind of got yours and I see position position position. What do you got [laughter] in here? >> Um, I'm long 100 shares. I sold the 3842
strangle in July, >> the 31st expiration. I did those strikes specifically cuz it was trading 38 at the time. I wanted to remember that when to end up looking like this. U I am long shares from another put I sold a while
ago. So, and then I sold that strangle and then uh I um got a little bullish position out in August. Selling two to buy one. I did this on a day where it was trading 35 cuz again I wanted to remember and some point this thing is
not going to be so hated. It'll bounce when it does. That's what this position probably should have went out to SEAP. And then I just have another short call point, but I don't know. I don't like to roll. This is September. I'm just going
bas this is the thing that this is the short that's actually against the shares. So those are the >> rarely do I have that many positions on >> I like it. >> Yeah. [laughter] Yeah.
against it. It's pretty cool. >> Yeah, I know, right? Yeah. Yeah. I mean moving right now and the way the how high. It's really not that high but it's higher than than most. I mean I I always
important metric with something that nobody else has that we have but you trader. I like looking at the actual implied V of something as well and 40 that's not high compared to Bitcoin historically but it's kind of high for
an ETF. So kind of like that >> it is it's very high for an ETF. So I implied volatility still is high. >> Speaking of high volatility for an ETF, EWI is another name I'm short. I got a strangle in here. I did this earlier
this year and got my ass handed to me actually is what [laughter] happened. right around here, I started doing like 150. This thing went up to like 180. I was like, dude, I'm out. And rightly so, it kept going. But now feel like semis
have calmed down. Have you noticed that a little bit the last couple of days? bit. like they're still making moves but they're not making >> huge 40 dollar moves etc. Let's take a look at Micron by the way. Um you know
2% 2% is acceptable. That's fine. 5 10% that's a bit much. >> Those are that those are crazy when you get into the 2020 like the the wild gaps up that you saw for a long time. >> Yeah. Speaking of gap ups, uh Sandis
back up once again 2,000 again. Muted move for now. Um looking at my watch move for now. Um looking at my watch list here. Nvidia is up 75 cents. Google's down at the moment. Apple continuing to go higher more recently um
back. Got some calendar calls in here as well. Calendar calls, I know I say it a lot. I'm surprising, I'm telling you, I used to hate the idea of a calendar call trade cuz it just didn't work in a world where everybody knows everything. How
in another? That doesn't really matter anymore. However, I found a way to manipulate them by going to the expected moves and going some time out. And it it >> Now, what when you set them up, would you try to keep it symmetrical? Are your
of days in there. There's actually some sales in there if things go wrong, too. >> Yeah. So, in this case, I I bought and again, it does vary my decision on the actually probably should take off at this point. I don't know. Depends on how
far out. Depends on what's going to happen in the name. But I I do keep them symmetrical. And I try to um it depends on on my um my current feeling on the the name, you know, like Apple after this big move we had, right? I just
right here. I was like, "Okay, I want to get long some Apple, but I don't really want to buy calls. I want to I'll do the calendars and I'll buy I'll get long and then an expiration that has earnings, which is August, and um or after August,
and I'm going to sell anything in front of that." And so that's kind of the idea of the genesis. Oh, the net net gas we got filled. Got filled on the net gas net in net gas? >> 20 cents.
do, Jeral? Can you open open up the options again for me real quick? >> in natural gas. >> Okay. Just go to natural gas and then the position page if you open it back up the cycle that you're in.
>> Yep. So, you can um if if you put an order in and I put it in as a GTC to sell out your long and make it a symmetrical butterfly and so bring it up to the 275, >> right? 275 would make it symmetrical.
>> 275. Um, >> right cuz you're only broken by one. So, butterfly and put it in put that order in for if you collected 20 cents, put it happens, if you get filled on this, you've got a $100 collection and a and a
True. >> And put it in as a GTC. And I am ordering you around and I apologize. [laughter]
you will get filled sometimes. Jamal, here's what I'm going to tell you about to come in. You can come in and be filled overnight depending on if you get >> If you get a pop up, you could come in and have a butterfly that you got a
dollar credit on or a $100 credit. >> Yeah, good point. Yeah, on that. >> No, no, that's fine. Actually, [laughter] I'm fine with I don't I don't trade that way. I I don't. So, I'm glad you are you're telling me I don't I'm
it like that. You know what I mean? Like, I just put that trade on. I was I'll just leave the way it is." But I never think about it like that. >> Yeah. So, then you can because there's 42 days. If there was 10 days left, I
got 42 days left in this trade. If you come in and you've locked in $100, then butterfly and put it right on top of it. So, then you've got the peak here and you can create another peak. >> Mhm. I I'm a I mean I'm a junkie. I'm a
>> this is your trade. This is what you do. Like that's what you do. You know what I understand. >> Creating lots of complex off orders for years and years and years. >> Uh more more selling and um CME more
>> Was the SIBO down too yesterday? I know I know the CME got hit, but was the SIBO down as well? >> Yeah, both. Both uh more recently got a couple positions on in both my ex as well. Um, so yeah, that's the story
this. >> Yeah, I just I just noticed it >> Is this liquid? >> Um, and not really, [laughter] but still put in here anyway. Um, >> just just in case we get the bounce at
some point. So yeah, even the S&P's up 37590 right now. So kind of NASDAQ I hasn't turned. It's been in the same spot. They're all kind of in the same spot. Russell did take off, though. Russell's up 19 all of a sudden.
>> Yeah. >> Russell's up 19. Uh let's go to the watch list here. Let's look around futures here. Um what's moving? Well, we futures here. Um what's moving? Well, we got wheat up some. Got uh Brent crude
that a little bit this morning. Oil first day in a while it's up a dollar right now. Crude oil 7630. Corn is up. So, you seeing some commodities move to the upside. We just mentioned Russell 2000 becoming the leader in in the uh
the clubhouse here as far as the equity futures go and uh lean hogs. You ever those? >> I have. I have traded lean hogs and live cattle. I've traded both. [laughter] >> Yeah, very interesting.
lean or why they have to make them live because I've never traded a dead or a because I've never traded a dead or a fat hog. Right. [laughter] when I'm because I'm a volatility chaser. If there's nothing else going
we've got volatility across the board. So I don't need lean hogs or live >> Exactly. Yeah. I don't you don't you don't need it in your life when when everything is going so well. >> J Bill Aat leading your the leaders to
the upside as far as the S&P 500. J Bill up 11%. I forgot about that stock. That stock's 400 now. Wow. AAT $600. Holy cow, man. I just haven't >> I don't have anything in AAT. >> Me neither. I I mean, man, I hadn't said
that name in a while, but wow, it's up $600 stock. Uh Lamb Research, same deal. 300. So, the semis are kind of moving. Those spaces are moving a little bit. Some of these other names. Mosaic, that's up bucks. Robin Hood to the
upside about trying to break uh 100 once again. Interesting to see Robin Hood up. today. Yeah, it's interesting to see that up with Bitcoin down and the market >> Well, yesterday Robin Hood said they were firing 15% of their workforce or
10, one of the two. Yeah. And you know, the odd part about that is um stocks usually go up when when companies get >> it does happen. It it is a phenomenon. Yeah, for sure. Uh Intel, William Sonoma, let's see to the downside. What
do we got? Carvana. I think they had earnings. It didn't trade it. Not really your point, like uh there's there's a lot of things I can trade. Not really. are not that interesting to me. I I'll wait till the next cycle which is coming
up not too far. I mean um or is that July? I mean when when's uh it's probably a while, huh? We got JP Morgan earnings like that. quite a bit until until the bulk of earnings come and it's usually if you
that kick it off. >> July we got a minute. >> I get so excited for the financials and then they're terrible earnings vehicles. >> Yeah, I know, right? They used to be great to trade on earnings sometimes,
right. It's been kind of terrible. Go back to this watch list. Um, what other of those down. Adobe is down. I think that sock is cooked, man. I feel like in a world where and AI is creating images, why do you need Adobe?
>> You know what I'm saying? >> I don't know. I think but I So, I do the age-old discussion. If it's going to create jobs or or take away jobs, I And I think Adobee is one of those things that's just going to go kind of
>> Exactly. I I I think that's the case. They're going to be it it that's exactly change created, just moved around, and I mean, you know, it's just find different seem. So, that's how it goes. >> What about what about Nvidia? You know,
yesterday where he pretty think pretty much thinks that Nvidia is going to be the catalyst for the down move. What What is that stock doing today? What is that stock doing today? >> It is up a buck 30 208 right now. Now, I
he comes on that he brings Nvidia again with that box around it because I want >> Yeah, it was the box. It was basically in this this range right in here, right? >> To say kind of there's possible failure, but that was um I mean, it's it's um
it's trying to stage a rally. I guess we'll see. I could see. I mean, and again, if you just like look at the the last time it was at this level, when was then we ended up seeing a fall. So, who knows? That's that's what the charters
look like. Look, I like charting. I look at a lot of charting stuff. I mean, lot of stories up based off of charting, too. Like, you just can based off of right here and draw this line and say, "This is the last time it had failure,
You can do that. >> Or you say if it breaks this line to the upside, then it's strong. >> I I mean, I guess you can create never seen the charts. It's weird. My My brain doesn't work that way. I need the
this, I look at charts as a as just for fun, kind of a visual to see where it's been. But I've never been a chartist. I'm a straight up quant options just >> Yeah. I kind of started off as a chartist. I understood charts before I
even knew what options were. And um the hardest part for me actually, Liz, when trying to marry those up. I couldn't do it, you know, like I I was trying to strategy I want to apply based off of a chart I see. And it was really hard. And
with some help from like some senior traders that I learned from that's I was And again it's not an exact science like just because a chart you know might necessarily mean your strategy is going to work but you try to put on the best
>> based off of what you see. And it's good. I think all know I think all to know those things. I've always wanted a segment Jamal for my in intern where didn't want to see the name and I did not want to see the chart and just open
with a strategy because it doesn't matter technically where it's been or where it's going, right? Or anything like that. But the numbers are the be pretty interesting because the problem is my emotions go with certain
very emotional. You talk [laughter] about you talk about Intel, I'm very emotional about. where if I covered it up, didn't know what it was, can't look at the chart, and can only look at the option chain, what would I do?
was maybe I was too soon to speak. Uh, Marll stage in a nice little move today, up 5% in change. >> I can feel that in my portfolio. So, >> I can feel that in my portfolio. So, yes, [laughter]
because that position, I've said this before, but is bigger than a bread basket by chance, not by choice. So, I always know when my account is moving. I I wake up in the morning and I look at what Marll is doing first, then I check
bad way to be. Somebody needs to stop me. Look at this fall. That's why I'm short this strangle 100 and change. I'll take >> You're playing with fire. Jensen Hong said it's going to be a trillion dollar
>> Two things can be right. It's going to be a trillion. It ain't going to be a >> It's true. Fair enough. >> It's like what? 300. Is it 300 uh that? Maybe. Probably. I don't even think it's that much. I'll check the
that. >> You You move around. I'm going to check very curious. >> It's Yeah. 245 billion. It's right here. >> Yeah. I MEAN, COME ON. WE GOT A 5X HERE if that's the case.
It's [laughter] not doing that anytime soon. I'm I sold on that. Sold. So, selling it. You know what I mean? >> Come on. 5X. >> What else is moving around? What else we
thing. This is one of the things that I do on the regular. I do look at this And Netflix has been one of those names. I've been I I've been thinking about thing is a dog, man. And um I don't want to see this is so you know, as much as
we trade there, there's there's times we talk ourselves out of a trade. Look at disgusting. >> Well, and after the split, I fully the, you know, the bell of the ball where it split and then kept going up.
It split and it hasn't caught footing since. since. >> Yeah. This one is 7501. It is just uh >> it is not that great. Um >> but yeah, market
>> I watch Netflix. I love Netflix. >> I want to sell a put in here. I'm just of the uh expirations. Like we got earnings coming up here. I don't know about I don't know about you, but I don't really like to sell like a put um
naked in a name that is not really if it were a complete absolute lows, maybe I'd here and I'm going to have this put for a little bit if I want to really get some actual like some real kind of uh value off of the put that I sell. I have
really want to go that far yet. So, I'm but I'm keeping an eye on this thing. So, I would go I have no problem making if you're making a directional stance before earnings or through earnings. I
be if you're going to be neutral. So, because it's like running in sand. If know you're you're selling a strangle in there and you're you're going through but it's just trickier because what you're waiting to happen is time to pass
should continue to keep marching up. So, it's like it's like running in sand. selling in this situation, the reason why I don't want to sell before earnings me. I want more than a dollar on a $75 product, and it's just not enough. So,
that's why I'm not doing it. >> Markets are to the uh moving to the upside. Uh but uh not that much further than where we've been. 7595 on the E- Mini S&Ps up 8 and a quarter, 177 points to the upside in NASDAQ, 30,400
299. We are seeing some movement out of the Russell. I don't know if it's uh the it's the banks that's causing that to move or what it is, but uh Russell is is the leader in the clubhouse. Almost up a percent 526 on the uh Dow right now.
Let's uh you want to get some confirmed question Russell. You Yeah, you do. But >> Yeah. >> When everything else is done that leader in the pack, that's that. Interesting. >> You want to get some uh to some confirm
>> Yeah, let's do it. Let's do it. >> Want to use that reading voice of yours? >> My teacher reading voice. Okay. Ready? I can't believe today's the 17th already, >> The summer is it's flying by. Okay, question number one. When you scan the
interested in, what is the first thing you actually look at before you put on a >> Expected move. >> That's a good answer. or evolve. One of the two. It just really varies depends.
>> So, I I I was mine. I was going to say the premium around it. So, if it's a option chain and you can see that just out of the monies, you're getting 50 cents, 30 cents, close that thing right up because if I'm selling premium, I
paid just like you were talking about with Netflix a minute ago. But I changed think you're right. [laughter] Expected move. but expected move first, then premium second.
>> Let's go to the next one. On a Fed day like today, are you more focused on direction or are you mainly watching how implied volatility gets announcement? >> Am I mainly focused on direction? I
mean, I'm always focused on direction. Delta definitely paying attention to Delta definitely paying attention to that. I I I mean, usually heading into did today. We looked at implied volatility already. Kind of got an idea
yeah, I mean, I'm definitely focused on direction. like the direction changes. A lot of times on Fed day, we'll we'll see um what we're doing right now, which is closer to that announcement time, things start to move around a little bit. So, I
>> They they do they do kind of percolate right when we get closer. It's pretty trying to downplay this cuz it is the first meeting and it is worse and all was more more important to me the last couple days than this is, right? So,
the oil move, we might see the metals move, but I don't expect a big move out of today because I think they're pricing in such a non-event. It's the ones where or anything goes where you're going to see some more big movements in things. I
don't know though. I mean, I could be very surprised by what happens today, said, I'll be watching more SpaceX options today than I than than looking at the the bonds and the gold and the and the metals. So, I don't know.
interesting thing. Uh speaking of it's trading 203 kind of off of its highs earlier. >> Is [clears throat] it has it gone red yet? >> Uh has not gone red [laughter] yet? Not
>> I'm going to keep an eye on that. Just like when we were watching when it was price. I I think we're I think we're going to see a red a red tick today in >> One red tick. >> Oo
yeah, I know. Have we haven't yet, right? Yeah. Put that in the chat. in the chat, Frankie. Uh, will SpaceX close uh green? Will Will it close the chat. >> Oh, I think it's going to close positive
>> that's a good It's a good poll question, though. People love a good >> I think we're going to have a red tick. >> Let's go to the next. Let's do another question. >> Okay. When option premiums are elevated
around a major event, how do you decide whether the better trade is buying the move, selling the volatility, or staying out completely? >> That is a really good question. >> It's this is a four-pronged question,
>> It [laughter] really is. It really is. >> Um, >> how do I decide? I mean, it it varies. It really does. It that's a that's a great question and it's um it covers a lot of things. I mean look a lot of
it's a major name like a SpaceX or example which is going to be like that soon but Apple Microsoft etc. So those type of earnings I I usually like playing those because they're very
liquid names and so I don't mind playing the volatility. Um I like to play if I mostly here. I mean there's not too many other events. We'll we'll we'll I guess we'll add on to this other events but for now let's just keep it at earnings.
earnings cuz those are some of the bigger names in the market. There's some more liquid stuff. Now there's volatility around things like a WWDC which we were talking about last week with Apple where we can change.
>> I stayed away on that one. I actually didn't do anything and then I got in after which is how I got those call calendars that I have. How about you? >> I I I mean honestly this question like I said it's a four-pronged answer. It's
almost a personal question, right? So you know it depends on the name. It cuz sometimes I sometimes I avoid earnings at all costs. And sometimes I and there's really no rhyme or reason to it, but nine times out of 10, I'm using
the options implied volatility to put on a smart trade in it, right? So I might something that I want to get into. I might wait until the earnings volatility get into it, I'm going to use that high premium to sell puts. So like I said,
things there are some things on the show that I would do with Jenny. I wouldn't it. Right? So, it is a [laughter] very personal it's a it's a very it's a very personal way to look at it. So, um removing the emotion is the greatest way
to do it. Like I said, cover it up and just let me make a trade. >> Yeah, I mean it it it really does depend like you know like like uh Micro had some high implied volatility and most people probably aren't touching it.
I'm interested in it just because I find it fascinating to trade names like this loves them at all and nobody is interested. Um I've I've I I kind of years ago. I used to always kind of get in things a little bit early and then it
became you know I want to wait until everybody is talking about it and you other people on the network I would hear if if everybody is talking about that name then I get more interested. And so like that's kind of how I've I've
approached myself. I want to just wait until I hear more people talking about or something in that name. That's what gets me a lot more interested. And situation of I want to play it for that reason. Now I want to make a play and
clearly this is a name that's really interesting to everybody and clearly the VA supports it as well. >> I'm going I'm going to keep saying Marll to you. Marll. Marll. Marll. [laughter] >> I want you to join my bullish stance. To
move. It's pulled back. This is great for my strangle Liz. This is fantastic. Fantastic. We love this. >> Never never count a good Marll out. great story about Marll, by the way. >> I bet he does. I bet he does.
Frank, number one, try to punch him in the stomach. Number two, ask for his >> Um, let's go. Let's go to another slide. How many more slides we got? >> Cool. >> Okay. I heard Liz say her son puts on a
daily zero DTE SPX options trade. I do. He does. Could you walk us through the mechanics of that trade, how it's structured, when he enters, and what This is >> easy lemon squeezy. Okay. So, if you go
to SPX, Jamal, let's pull up the SPX trade. Now, he knows, and it's funny because I can watch and he'll I my account is linked to his so I can see to set his alarm today because I know he's sleeping, but um 9:00 our time,
which is 30 minutes after the market opens, I he has no idea what he's doing. It will open up the zero tote spx. Go to the expected move. No, no, just just the >> So, just the put spread. >> Just the put spread. And go to the
expected move down. >> Yeah. But how I'm right outside the >> All he knows how to do. Jeral. So, keep in mind this is bad trading 101 or bad mothering 101. One of the two. He doesn't know what he's doing yet. He's
knows to open it up on his phone, go to the brown bar. That's all he knows. You sell one right outside the round bar and you buy the next one immediately. So cents to a dollar. Is that true here? >> Buy the next one immed. What do you mean
>> So he's doing a $5 wide spread. Exactly what you've got there. So he doesn't looking at. He knows he goes down. You sell at the at the brown bar and you buy the one underneath. So sell and buy one. >> He usually gets around 80 cents, 90
>> Uhhuh. >> And then he sells it. and I've been having him leave it because up until this point the pattern day trading rule was something that he couldn't do. So now we're working on going in there and
having him close it at 50%. But he's been setting it up and leaving it and it's been pretty decent um because it's not a lot of risk. So I have him been days when it's a full loss but then 4 days later he's back. Right? though if
you're doing it every day and what I love about him actually particularly with this is that he's very mechanical with it. So, I'll open it up sometimes today." Or, "Ooh, you know, the this boos are down too much or they're up too
much." Or, you know, on that the day where we were up 120, I watched it go doing? We're up so much already. Why would you put in a put spread?" But the knowledge that we have has been very helpful to him,
>> baby. >> So, that's it. He That's all he does. It's a $5 wide put spread wrapped around at the expected daughter the exact same thing. >> Go outside.
>> Well, I like doing the um I'm going to do the iron condor on this. I'm trying to sell it right now for two. Let's see if I can GET THE IRON. >> NOW, all the Can you hear Tim? Yes. [laughter]
>> I mean, I think we should we should probably bring him in. But all the research says wait until 9:00. All when Jacob was on before when he's done around nine o'clock is the sweet spot give or take five minutes for trading
>> Well, this is right in that wheelhouse. I just got filled for a buck 90. So Nothing crazy. >> Yeah, that's great because your your bad. >> Yeah. Yeah. Um yeah, markets uh right
now just uh fading to the a little bit here. The E- mini S&P is down two now. here. The E- mini S&P is down two now. 75.85 85 30,362 on the NASDAQ only up 50. Lara fading fast. The Russell even fading. It was up
almost a percent. Now it's half a percent. 29.81 up 17 points. And the Dow up 172. So now the Dow is positive. We're moving. We're flipping around. [laughter] >> Let's see what's going on.
>> Yep. >> Hope. Does he Does he have the Put the poll up, man. Put the poll up. Where will it finish on day? Red or green? everybody wants to know. >> Like I said, I'm talking my book because
we're going to be down on the day. I mean, barely. This is What are we down? >> Good lord, look at me. Oil is up. >> All over me. Oil. Oil is up%. >> All over me. Oil. Oil is up%. Um NASDAQ down. Not NASDAQ. Uh uh sorry.
spread on this morning. I'm going to publish these trades in a little bit here. Um, we got the Bitcoin down slightly. Uh, talking about currencies here, is the dollar up today? Let's take a look here. The dollar is slightly up.
moving to the downside. You'll see here. Aussiey's down. British pound is down. Canadian dollar is down. Euro is down here. Looking across the landscape of a what a lot of what I look at these days. I think everybody is. Nvidia is down. We
Google's down. Apple's slightly up. Microsoft is down. Amazon is down, AVGO positive, Tesla negative. So, interesting times here. But, um, I think it's time to bring in our guest. Is it not, Liz? You ready? Ready to do this? I
>> I I'm ready. I can't wait to see him. >> Mr. Tim Knight, how you doing, sir? >> Hello. Hi. Hear me? Okay. >> Yes. Yes. Yes. Yes. Good puppy. How's the puppy? He's Is she doing okay? >> Yeah. No, they're they're I had mud all
over me a moment ago. My white shirt like I brushed most. >> He's got white shirt on, LIZ. AH, YAY. THREE FOR THREE. I LOVE IT, JAMAL. days, I've been throwing these moray patterns where like
>> That's right. Bad on the viewer's eyes. You're absolutely right. Okay. If you get a husky, this is what you get. You're going to get noise. She has she has things she has to say. >> Um anyway, I actually have uh few charts
chat charts a bit. That's >> I love it. It's my favorite part of the >> I love it. It's my favorite part of the day. Yay. Okay. Um, and there may be commentary along the way from below, but I can't help that. Um, [screaming]
I can't help that. Um, [screaming] >> as you just heard, this is SpaceX. [laughter] And um it's funny cuz like um you know they they do these YouTube videos of my show in the afternoon and they have to
come up with like one banger headline to describe it and they're not by my choice but sometimes I have to really watch what I say because it's like along like yesterday was like Tim calls the top on SpaceX like gez it was just you know boy
I that could be wiped out this very morning but so far so good um because it peaked I include after hours on that like a 228 um like 30 hours ago, but we're getting our first red bar out of 4 days of
trading and uh we've got a a onehandle leading uh which is going to kind of bother people cuz you know this thing popped 50% in the first two days and um
fellow wrote me yesterday and noted that uh yesterday Elon could lose a trillion dollars and still be the richest man in the world. That kind of puts it in perspective. >> So,
curious because I just was reading a lot about this recently. Talk about people dollars, but he doesn't have that in a bank account, right? It's in these lot of billionaires live. They give themselves like a salary dollar, right?
And they do they actually kind of take loans against that in some way, shape, or form against their holdings. Is that is that kind of You live out in Silicon deal? >> Oh, yeah. No, I listen I I uh my
schools and I was I was the I was the economic diversity in the place. [laughter] Um I mean I I was honestly I felt like a country bumpkin cuz I'd go elevator. It's like I've never been in a house with an elevator before.
house with an elevator before. >> Um but uh yeah it's um they avoid the taxes, you know, basic so you've got an enormously valuable asset. If you need 20 million bucks for another villa, you borrow 20 million at a very low interest
rate, you know, with your collateral against your stock, they don't tax loans yeah, you just hang on to that stuff yeah, you just hang on to that stuff forever. Um, I mean, yeah, there there's
You've probably heard the the Peter Teal story as well. So, I mean, his his billions are going to be taxfree. Um, so yeah, ugly stuff. Um but uh sure. So,
here we have the first red bar and uh it's uh I think the whole SpaceX thing is going to be an amazing journey, but a year from now, if this thing's like 50 bucks, which I'm not saying it will be, but um there's there's going to be a lot
of highs and lows in this, but I just the reason I shot my mouth yesterday and said I thought the high was in was just come on, you know, worth more than come on, you know, worth more than Amazon and just do nothing but bleed
Amazon and just do nothing but bleed money out. Um I I it I I I still kind of stand by it all as risky as it was to think that SpaceX has kind of topped out 3 days in, you know, but we'll see. Uh anyway, there's more to life than
SpaceX, of course, let me just look at a few other items. Um, SMH. Um, speaking of shooting my mouth off, uh, two days ago you guys might remember that on this ago you guys might remember that on this bar, uh, I was talking about how, uh,
uh, and I hesitated to do so, but, you know, short semiconductors and, uh, that, you know, so far so good, but this one day plop wasn't really all I was anticipating. I'm I'm looking for plenty more than that, but uh, I don't have any
egg on my face on that one so far. That that was a really good call in terms of um the the price teetering right on the trend line. Um what a I I do have one chart I really want to hit there. Uh in Q lifetime
highs in entertaining trend line uh listen you know now that the UFC match is out of the way we can focus on earnings next month. Um, I think this worst thing is going to be a a nothing burger today, but uh it'll be
really refreshing just to get back to earnings. And you know, the tech stocks have to basically hit it out of the park like crazy to to sustain these like crazy to to sustain these valuations. Um, ES also right near
lifetime highs yesterday, new record. But, you know, that range I think matters and I am way more inclined for weakness than strength at this point. of, especially this morning, and I've
of, especially this morning, and I've had puts on this, uh, it's Carvana CBNA. Um, we're down today on this, which is fine. Uh, but what I love about this is this pattern I've drawn here. I know this is an oval, but I'm being lazy
here. This is a diamond reversal top, which are it good ones are rare. And, uh, Carvana uh, is a very richly valued company to begin with. And it's got kind
of a unusual history to say the least which I've written about a bunch. But what I like about this is, you know, one from a fundamentals perspective, it's from a fundamentals perspective, it's super expensive. Uh two, we've kind of
super expensive. Uh two, we've kind of been here before with respect to and I'm going to try live and without any any net below me. Um well, now I'll just do a rectangle. I'll be lazy. Uh we've had kind of coming kind of a similar setup
before like so so there's a bit of an analog going here. Uh added to which we're at the same level we were before this precipitous fall. So um >> wait Tim what time frame is on Carbana? >> Uh we're looking here at a good six
>> Okay. Yeah. Yeah. >> And it just shows the cleanness and the >> And it just shows the cleanness and the the magnitude of that top. Um, now you two are about 30 times more sophisticated than me in terms of
trading. I'm just a dumb old bear. I just buy puts. But I've got puts on this. All the puts I own on other positions are way up next year, January 2027. This is the exception. This for me is aggressive. It's September, which is
still, you know, almost 100 days. Um, but so far so good on this. I really like Carvana on the short side. >> Is this a um is this a a chart story? Is this more of a fundamental? This business model doesn't necessarily work.
the chart story exacerbated by the fundamental story because um I don't know there's a lot of I get a lot of sketch vibes off this one. Um and uh even if you look at the basic fundamentals it's just like huh really
expensive. Uh how they how they've had this ex extraordinary recovery just hundreds and hundreds and hundreds of percent is is amazing to me. But um th this uh this has got to be my favorite chart going right now.
Tim, I just >> That's [laughter] right. honor of you. >> Oh, well, I am honored. Thank you. God >> Yeah, I'm looking. >> It's [laughter] uh Yeah. No, I mean,
>> It's [laughter] uh Yeah. No, I mean, like I keep saying, I I know that um uh by and large, folks like to hedge a lot. Like, you know, maybe this, maybe that, but uh I like to kind of lay it on the line and and uh I've wound up with
that I don't care anymore. I just say what I think is going on and why and let >> Yeah, I'm going to sell a call. >> Let the portions fall. whole entire book. I need some short deltas.
So, I went in. I mean, I just did a I did a 60 a 30-day 60-day diagonal, bearish diagonal. >> Yeah, I like it, Tim. pretty. [clears throat] That's what So, one of my favorite
the afternoon because you come up with a directional assumption and then I overlay whatever kind of complex option trading strategy on top of it. see how it goes. >> It's my pleasure. It's my only skill.
>> Oh, you got more skills than that. You're selling yourself short. Come on. Don't Don't do that. Got it. You're doing a great job as always. Fantastic stuff. Um, this might be again one of those days where we'll see what uh what
what happens. Your your appearance on the show is always important because every time something >> I mean, he's still he's still on with >> Who's rallying right now? >> No, I'm I'm Yeah, I'm afraid you're
nice tweets and like, you know, I hope It's like, yep, >> like it or not, here I am. >> I hope you like it. It's been great. I really do thoroughly enjoy because I I
understand charts. So I would rather rely on somebody who has been doing it for years to say whether the chart is good or the what the chart looks like. face. Yes.
>> Love it, man. Love it. Thanks for coming on, Tim. Great to see you. We're going to take a quick little break here. E- mini S&P's up for 7592 and uh market seemingly positive right now. And of course, we got the big Fed
stick around. We got plenty more content for you. This is Tasty Live.
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by the lovely Liz Deer King and we got Sahil in the house with a market >> All good. All good. >> You watching soccer? You watching World >> Yeah. Yeah. I watch I watch I watch the USA Paraguay game. That's the one game I
>> Got to support our our >> I'm going to get more into it when the the playoffs the round of 32. Whatever. >> I agree. When when that happens. Yeah. >> When will that be? >> When will that be?
>> Probably in July. >> The finals on the finals on July 19th, I >> There's only six weeks. >> So, yeah. I'm thinking it ends like August, something like that. I haven't even looked at the calendar past the
>> I'm expecting I'm expecting the US obviously to get out of the group stage in a home home world cup. So, we'll we'll see how far they go. >> But who are you are you rooting for anybody besides besides them?
>> Germany, France, Argentina. >> Yeah. You know, I um I really I I haven't been busy, I guess, with life and stuff. But I really haven't like the other teams that I'm interested in. I would say till last night I just
some friends hanging out. We were watching the um Argentine and Algeria. I was crazy. >> Guy's good. players at the top that they debate you know LeBron or Jordan or whatever. So in
soccer are you Messi or Ronaldo kind of person? >> I was that's a good question. Uh I I guess I gotta go me I like I do like him >> Um, >> Liz, you know who Ronaldo is, right?
Ronaldo. >> I'm just gonna sit here and smile. Ronaldo is. >> I know the names. I know the names. >> I'm more interested in your LeBron. Be very careful when you answer this,
Sahil. I'm more interested [laughter] in your LeBron or Jordan. >> Well, I'm going to phrase it just very simply like why I think this way. So, I don't follow basketball too much, but Jordan is a more popular name outside
the basketball community than LeBron is. Especially like what kind of shoes do Not nec. I'm wearing some right now. >> I don't see many people wear LeBron. So, argument. You got to >> It's true.
Who transcends the sport to the people who don't necessarily watch the sport? would say, cuz that's a name I know. How about that? this market measure, man? >> So, we talked about the diversification
heavily go into it on utilities because we got a bunch of questions on this basically uh like we're going to start we're going to start using the emails attacylive.com if anybody wants to send in any ideas or anything they want to
nice simple market measure talking about utilities uh today. So, yeah, let's get started. I have the monopoly board on the first slide. Yeah. Yeah. to show shows what exactly we're talking about water and electric. You know, the one
thing I learned when moving out into my own apartment and stuff is uh the rent and everything. They got to pay every single month. I don't think when this, I don't think it necessarily hit until it starts coming out of your own
>> Dude, I was literally just talking about this type of thing at my dentist you know, kids. I got a 22-year-old. He's living at home right now, but like figured that out over time, like paying for stuff. Like, wait, I got to pay for
this. Really? Like, what? Like, yeah. >> Yeah. Water's not free. Electric not internet, too. >> Liz, what's your favorite properties? >> Yeah. >> 100% the railroads. [laughter]
It's like you and your medals. It's like same thing. You get you can get paid off >> There's a whole strategy behind this game, too. No doubt. It's like if you take the pink and the orange properties are like the most valuable because of go
you onto the first half of the board all the time. So people have done like math competitive monopoly matches and stuff. >> I could believe it. I could believe it. to get Parkplace and Boardwalk but you know you don't land on those a whole lot
[clears throat] >> and people have houses, oh my god, >> you got to mortgage you got to mortgage yourself just to get just to pay for it. >> You guys have your like house rules or whatever.
how to actually kind of play the the real rules of Monopoly or whatever, but >> because everybody's just getting bankrupted left or right. >> And then the one kid >> you play by the real the banker, you
>> yeah, [laughter] >> yeah. So utilities. >> I like it. >> Yeah. Let's go to the next slide in the actual uh market measures actual nitty-gritty on this. So now we have
investors as a defensive option during market downturns. And we're going to talk about basically why. Uh so one of the reasons why is they're higher obviously. Uh you can actually use them as a great dividend kind of building
stocks. Um Nvidia, Apple, Tesla, especially Tesla, they don't they don't with the tech names and the AI names right now, their volatility is super high, but the utilities not so much. Their historical volatility over the
last 30-day period has been has been kind of low. And uh relatively speaking, these are actually fairly high volat volatility numbers even still compared whatever, you know, as we've talked about multiple times. But relatively
speaking in the market and uh and their yields are often much higher. So we're just going to keep >> uh showing multiple examples uh on why how do they compare to different stocks over the next few slides. So cool.
>> Let's go to the next one [clears throat] Okay, so this is your XLU and SPX graph. I mean, you can just basically see over
months what has happened. So I took it from January uh 2026 to now uh June 2026 and it's like it's basically moving in the opposite direction. It's kind of There their correlation is like 0.06 or whatever. So if you need some nice
diversification play like we talked about, not necessarily gold and if you because of all the stuff that's happening with oil in the market, uh you into stuff like utilities or real estate or whatever that has pretty low
>> and to your point low correlation but you can see at times when correlation does get high like we saw in March they all follow they follow the same path very similar pattern from March to like middle of April and then back to being
>> uncorrelated right >> how you pick the times pick the times >> Yeah. Yeah. >> Yeah. Like like the the these change like I said uh two days ago these things like change in the market. you got to
couple of weeks or whatever to see what what is actually diversifying what is actually correlating with the market or whatever but uh yeah so uh so yeah negatively by high interest rates uh so high interest rates can put downward
rates hike can make alternative investments such as bonds look more attractive to have another slide uh later in this talking about XLU and uh the 10-year treasuries and uh um basically showing that when high
interest rates happen, you might want to step away from utilities. So, if there's in the market over the next 6 months or so, then you might want to step away safe haven stocks cuz that that's when everything is becomes more difficult to
trade. So, yeah. Okay. Next one. just again showing uh for the correlation graph for anybody who likes
the numbers with the the green and the red stuff. So you have all uh your five main utility companies that everybody talks about on the first five and then talks about on the first five and then you know Spy, QQQ, IWM, Nvidia. Um an
interesting thing about this is I guess it has correlation with uh Spy and QQQ the most. So it's probably why the stuff in March was happening was uh because
trying to look for a diversification play. don't want a super positive super negative correlation cuz that makes it kind of difficult unless you're doing a hedge type of play or whatever. So, actually with the small caps, it has
that's just something interesting to know. But, I mean, the red and the green, they show the story pretty quick. Uh, you know, pretty much that they have correlation with different parts of the market, the overall market, the NASDAQ,
small caps, Nvidia, your your highest market capitalization stock there. So yeah, the next one >> there no correlation between them. Well, the visual representations. So, thank you for bringing
see it in different ways. Some people like looking at correlation matrices. We've had some emails before being like, you know, the the text on the graph is some numbers or whatever. I don't want to like look at the y- axis and like
trying to show different ways of showing the same thing, whatever. Yeah. >> Okay. Yeah. So, this one is your XLU and TLT. Yeah. So this one is for XLU and TLT showing the little correlation that you know bonds and uh the utility stocks
have over the long run. Uh and in that uh November period uh they had act they it has a little bit more. It's actually getting up to 0.5 over the past few months or whatever. So that just shows your uh when your high interest rates
step more into bonds than than you were into utilities. Yeah, to that end I I around you you can always learn things and I I had never really looked at the correlation between bonds and utilities and um it was Dr. Data who actually made
me realize like a lot of times when interest rates go up that's that's bad have a lot of debt and that's why they'll struggle a little bit at those times. So interest rates actually means something to utilities. Trust me,
attention to the Fed meeting today too. Yeah, right Liz. I didn't know that. I was like oh that makes sense. It was actually for it was at that time because in 2022 obviously interest rates were rising. I was like man these utilities
what's going on here and he's the one who pointed that out to me. >> It's interesting to see like the correlations or the math behind stocks that you don't really think or or equities or products or whatever that
think to compare necessarily, but they do. Everything has an impact on each other in the market, you know. So yeah, >> let's go on to the next one. >> Yeah. So now even more showing high interest rates because this time we're
looking at the treasuries and uh S&P so the overall market and treasuries and actually the correlation over the past few years. So this one is looking at the past 5 years from August uh 2021 to uh June 2026 where we are now. So uh the
past 5 years and uh before in 2021 2022 the correlation was not really there but correlation has has started creeping up a little bit. uh and over the past year it has actually been kind of following relatively together. So,
22 when things were really changing rapidly as far as the landscape for for yields. I mean, that's it was fast. It well because a lot of times it's been highly correlated markets, but
changed rates that the market didn't like it and you saw that. >> All right. Next one is >> so now these are your success rates. If you want to do your 45dt uh 30 delta puts in here. XLU wins out on the
actually compared to bonds but bonds have a less uh are less volatile. They have a less large loss. So these are for the numbers for anybody who's trying to trade options in XLU or TLT uh with the 30 delta puts. And we're
[clears throat] put this on here because this actually puts the numbers around numbers for strangles, but because generally people like to do puts or uh strategies, uh not too many people do bearish options. So, I thought puts
And 30 delta uh in case anybody wants to get a little more aggressive into it. than you do with the 16. So, it's a little easier comparison. I like it. I like that.
>> Finally, takeaways. These are your I try to keep these as simple as possible. So your takeaways are rotate into utilities when volatility rises or economic growth Underweight utilities during rising interest rate cycles and then over
overweight them when the interest rates start falling. Then use utilities as a behave differently than stocks and bonds, uh real estate, all these other different hedges. It's just nice to see what you can use as a hedge, what you
>> Fantastic. Love it, man. Good stuff. Yeah, I mean it's it's a good time. I tech, people should be looking at other things like utilities or consumer there >> or just sell all the puts in SpaceX.
>> Yeah. Or you got I mean, you know, you can do that too in SpaceX. You can sell >> Yeah, >> it is margin now. And guess what? It is down today. We're seeing the first down day in SpaceX, right? [laughter]
>> It's easier to sell. It's It's easier to sell puts when the market's down than press that 30 delta put when the market's up 50%. >> I know, right? >> All of you guys, the market makers.
>> Contrarian is like in your blood. Okay, >> it is. It is. It really is. Yeah, for Great job. Fantastic market measure. Good stuff. See you uh another time. >> Another time. Yeah. Yeah. >> Nice. Even the S&P's up 15 now. Market's
flying higher. We're just over 7,600. NASDAQ 30,500 up 217 points. The Russell up 24 points and the Dow up 22 245 points 52,700.
Stay tuned. We'll be right back after a quick little break. This is Tasty Live.
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get to level up. But they kind of like it when I'm feeling myself. I'm feeling myself. I'm feeling myself. [music] I'm just look at me. I don't I'm feeling myself. I'm feeling myself. I'm feeling myself. But they kind of
like it when I'm feeling myself. Look at [music] me. I don't got to level up it [music] me. I don't got to level up it when myself
up. [music] Look at me.
Yeah. in my song. [music] Let myself
[music] up. Look at me.
[music] You got a little up. Just look at me. Just look at me. [music]
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King and we got Gad in the house with some research trade ideas. >> Yo, what's up good? Living the dream. >> You're living the dream. Yeah, living the [laughter] dream. No tie today. >> No tie today. You went no tie on the Fed
>> No tie today. You went no tie on the Fed day. [laughter] be my >> He's still looking good though. You >> Yes. >> Oh, thank you. Thank you. That's just
>> I'm at that point in life where like I just want to wear white tea every single day. It's funny. I saw this documentary once. It was actually fantastic. Um but it's with Jimmy I and Dr. Dre and they talk about the sale of beats and
careers and all that. Dr. Dre basically was like, you know, I'm at a point in every day. >> Yeah. My wife My wife wants me to wear good stuff. >> Well, you got to do what the wife says.
>> Whatever she wants, you do. >> Ah, there you go. See, there it is, Liz. She rises wardrobe when he looks >> 80% of everything I own. She's from his >> Amazing. I like her style. You got to tell her I give her a gold star.
>> What do you got for these trade ideas? >> Let's jump to the trades. So today, um, >> Oh, there you go. >> Yeah. We're going to start with Tesla.
So this is a put spread Tesla. >> So Tesla today is down a little bit like 2% I guess like two around 2%. So my my ideology or my thoughts behind
this trade is even if it has like low IVR less than 25 or less than 30 but this trade is going down doesn't correct with the SpaceX um hype and everything.
So this because it's going down I'm saying it will not go down. >> Yeah. Yeah. Yeah. >> Really put spread. Selling the put spread. >> Yeah. I'm selling put spread. So the
last I mean the last price will be 375 or 365 for the last one. So I'm betting if the price goes down it won't go reach to the to the opponent and we'll be able to correct those premium even if we are in uh raw IVR environment with win this
in uh raw IVR environment with win this Tesla uh stock. Okay. Um, yeah, the Ivy rank is not as high as you would like, but I like the idea from the standpoint but I like the idea from the standpoint that Tesla I think is um I think it's um
It's hard to say Tesla sold off, but it kind of has a little bit. I like this this off for two. I >> I like this, too. You're at the expected You're collecting enough for it. I like that it's actually in the 30-day instead
>> there's no Yeah, right. Exactly, Liz. Like, it's before. That's why I like it. >> Yeah. Even if it has like some earnings due at the end of in July. >> Yeah. July 22nd. So after the after July expiration, which is why I like your
>> So within this 30 days, I think we'll be okay with this. If you get tested in the Yeah. >> Yeah. I like it. Not even so much for the V. I don't expect Vall to come in a whole lot, but I do expect it to move
again, it's selling V, but it's also a directional trade to some degree. I like >> Yeah. But but but it's smart directional because it can it can even drop. So as long as you only have 30 days just got stay above 375. So
>> Yeah, approved. We sold we traded up. >> Great. >> So let's go to the MD AMD. So this >> Yeah, >> there we go.
>> So this is the call spread. So I'm the opposite side on the Tesla one. So this >> did you say call spread? This says puts. The one was call was put. change the >> Yeah. So this is really a call. You're
You're selling the 580 call. >> Yeah. >> Okay. We'll we'll change that in post production. >> Yeah. Yeah. Yeah. Sure. So this is call spread. So then
spread. So then this AMD is going high in the roof. So when the SpaceX IPO got released, it affected these AMD stocks. It went down a little bit but it's coming up. So I'm saying within this high IVR rank uh of
92% that means there's some activity within this stock the price will continue to go high. If it goes high it won't reach to 580. That's my theosophy within this. So right now we have like 517 flies by
now right now. So if it goes high, it won't reach to 580 or 590 won't reach to 580 or 590 within 30 days. So if you get tasted close the trade area. You can do whatever you want. But that's my phrase
of behind this trade and you're going to risk the uh risk ratio is like two on one. Yeah. On behind this trade. So yeah, that's my philosophy behind this trade. These two ones here. >> Yeah. Lifetime high so far 55837.
uh doesn't mean it can't go through 480, but I I don't I like this idea. I mean, you know, selling this call spread, I could use a little bit of short delta. pop. >> Um I would say you're risking three to
make one according to this math. Um >> I know you're a research guy, God, but you got to you work on the math. I'm just messing. [laughter] good trade. I'm going to put this one on, too. Weird. I mean it looks like you
mean it's not going to go up but it's the same concept as the other side. It go past 580. >> Okay. Yeah. Yeah. That's my concept and also it's reacting to the SpaceX IPOs trading aspect. So because AI rated the
stocks so I think they have the same mindset the same kind of philosophy of moving towards um like going towards like uh increasing of the stock price >> filled 45. Good. So the next one
is it the proof of this one. >> Last one. Yeah. Two two approved so far. >> These are two. It's the last one. Don't mess it up. Don't mess it up, man. They saying baseball. >> So this I don't know why I put bullish
>> So this I don't know why I put bullish on this one, but it's Apple. So Apple right now, I can't say it's moving anywhere. It's not going down. It's not going up. Doesn't react to anything right now. And we don't have
anything right now. And we don't have major major like news in Apple except in September going they release like iPhone 18 but right now we are in kind of middle of like cool environment in Apple. So that's why I'm taking this
Apple. So that's why I'm taking this skewed iron candle. So being in kind of neutral bullish I I I like to call it bullish because it's like we're in bull market but also you can call it neutral according to
your understanding on how you're going to price this strike along your prices. So you're going to correct $130 and you're going to risk the buying power is 370 by the way. It's a cheap one. In 30 days, you can correct this uh buying
power. And also the IVR makes sense is above like 25 up to 30 and last price above like 25 up to 30 and last price 300. And the risk rewards is not against our theory sit. >> Yeah.
skewed. >> And that's that's how you're skewing it skew it. You can widen out the puts or you can go farther on the calls. And >> I what I was just checking and I you get a you're winning on this one. I just
the call spread to make sure it made sense to put it on cuz it was so far >> Yeah, cuz it looks like it's 50 cents maybe on the call spread. >> Yeah. Um yeah, this one is approved as well. I I'm I'm not going to put this
on. I like the idea of selling. So I know we're looking at IV ranks and Ivy trader. I like looking at actual implied VSS. I mean this one is actually selling bit longer to actually harvest that volatility just for just for people
understanding the trade. But, it's a good trade. It's a 63 uh pop. Um, and you are you're risking, you know, two to make one, which is kind of works on a good trade. I got some other things on in here. That's the other reason why I
to pay attention to those. But, this is approved as well. I like it. >> So, Jamal, here's my question for you because I know you've got a lot of stuff in Apple right now. How do you how do you sort them in your when when you open
your positions? Do you have them grouped by each trade or are you just is it just one big >> um a lot of times most days I have um the uh the PN I kind of sort by P&L to see alert me to if there's anything I
need to do either down or up and then I'll also um remind myself you have other Apple trades in there. How do you how do you sort these out? So That's the thing. >> The cross positions.
have calendars. That's why I don't want to put the iron condor on. >> Oh, gotcha. Gotcha. >> Yeah. So, that's why. Yeah, that's how. >> Yeah. Thank you. >> That's what I was going to say. I was
>> Exactly. That's why I don't do that. That's why I'm not doing it. [laughter] So, yeah. Yeah. Great job. >> We're running from the base. You two running from you and we always appreciate Yeah.
always learning from you. >> Yeah. Yeah. I mean, honestly, this is, just so you know, this is um this is an an age-old idea of presenting ideas to they think about it. This is what Liz did. This is what I did when we were
So, this is a great idea. I mean, it helps you. It helps everybody who's we're just giving you our thoughts. I mean, doesn't necessarily mean it's it's it's gospel, but uh we do happen to know
the world that could do what we do. So, you know, there is that folks. Uh that's Thanks Scott. All three were approved. Fantastic stuff. >> E- mini S&Ps are flat at the moment, slightly down 75.85, but uh NASDAQ is
up. Uh the Russell is up and Dow is up. So things are very fascinating so far. the big catalyst of the day. We'll see what ends up happening. We're going to take a quick 90 second break. You're watching Tasty Live
was like whoever could get the captain seat was it. >> That's great. I'm having a great time. >> Me, too. But I mean, stay a while. Take >> No. No. I mean, I'll stay, but the jacket's not cool.
>> Nope. [laughter] >> Come on. Take it out. I'm sorry. I didn't mean to. >> No, I'm [music] sorry.
guess you got to hear his tail. In ' 87, I took it off. There was the market crash. In [music] '92, NBC canled Blossom. A couple of years ago, I lost it for 2 days [music] and the Lakers won the NBA Finals. Bottom
line is when this thing [music] comes off, bad things happen. You've got to >> never deal. >> How do you shower? >> The jacket's kind of gotten used to it. In fact, every [music] few days it needs
>> No matter what, you keep you keep it on. >> I can take my shirt off if you want, but I'm not taking the jacket off. >> I just don't know if that's something that I could deal with. >> It'll be like a teal tornado
[music] I >> mean, I [music] >> Yeah.
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Chandler joined by the lovely Liz Deer King. And we got another person with a the house with some retail trends. >> I got the memo today. I I saw that guys. >> White shirt Wednesday. I'm I am here [laughter] for it. So excited to excited
to get into things here. >> Dope. Dope. Um >> we might need to borrow your sheet of singles for to decorate the office cuz I >> That's fine. I mean, have they have they have they appreciated? Do I get
inflation adjustment on what I paid? Cuz it's 32 bills, but let me tell you, they >> What a rack. A rack. >> Yeah. How much was the sheets? It's quite quite the markup for for 32 bills. Maybe it's 36.
No question. And they are legal tender. I could cut them up and use them if I if I so chose if it ever got to be a super rainy day. But dollar here. Do they all have like uh consecutive serial numbers?
would think. It's the fourth number that's consecutive all the way through. serial number is the one that changes as you go down down and then right, which last one like counting up. But yes, >> it's that's kind of odd. Almost as odd
randomly. [laughter] They're like, >> "Internest." >> How many singles you got laying around? >> I got two. [laughter] >> You can't ask your mom that.
space today. Uh, something that caught my eye is Lionsgate. Uh, they are down big today. opened up opened up down 5% uh after Netflix denied reports that Lionsgate. I I didn't actually know that
that was on the table at all. Uh but you know, always always a fun topical thing when when these when these movie studios are moving when uh you know as it as it somebody has a movie release that's so bad or so good it can move their shares.
>> It's fun tie-in between pop culture and the and the stock market. Uh as Space Mobile is moving as uh if you if you've heard enough about SpaceX this week. Don't worry, we can we can pivot here. [laughter] Uh AS up 6% after the
launched three new satellites into orbit uh to continue to build their cellular broadband network in space. Um and they used a SpaceX rocket. So SpaceX up 3%. Is that because of the AS space mobile successful launch? I don't know. I think
hype driven. Um, >> so are so are they competitors or not? needs launch partners like Rocket Lab and SpaceX. AS just makes satellites. they'll partner with whoever has the best price, whatever launch provider.
They don't care who puts them up there. >> Um, >> Yeah, it is. >> Yeah. Sinking. Uh, but yeah, I suppose obviously one successful launch not as pivotal to SpaceX's bottom line as as it
is for AS, >> right? Uh, CarMax, CarMax shares up three and a half% after a good earnings report. Uh, this one I I've actually traded CarMax a few times in in the last year or so. Uh, it's it's made made some
good moves. Quietly we'll we'll take some volatility or have some volatility. you pick your pick your spots right and you're directionally correct. >> Yeah. Little wide. A little bit of wide. >> I didn't I I actually I mean this is
night. >> Yeah. And I think is that why Carvon is move here? >> Maybe maybe it's cuz carb vending >> Yeah, we were talking [laughter] about that with Tim Knight earlier. Yeah, this
is I haven't sold an outright call in a while. I sold outright call in here. Um >> that was my Tim That was the Tim Knight special. He's very >> Carvana. Yep. Ah, there you go. Yeah, I sort of like Carvana's model. Okay. The
the at home car buying and selling does seem to work pretty well. I have a in the city and he sold it to Carvana and it was super seamless. I mean, they have to lift a finger. You just clean your car out, leave the keys in it, park
it on the street, they come pick it up. Uh, so there there is I don't know. >> Looks like to me. >> Sure. Sure. Yeah. Not a not a don't know. People are using it. Good way to uh to liquidate your vehicle if
>> Okay. >> Um, last thing I have uh catching my eye after its IPO. I don't know if that was in the 2026 calendar year or not. Its in the 2026 calendar year or not. Its recent IPO uh has since sank quite a
bit, but it is up 4% today. Uh City initiated coverage with a buy rating. So, not not the most exciting reasoning that I could give. Uh but City is saying on or Figma here.
>> There's nothing like when the market lets you know what it thinks of your stock. [laughter] >> Yeah, Figma. This was one where like 3 days post IPO it was I had relatives and and friends who are not involved in the
should I should I pick up some Figma? Is that free money?" So, I got short when It worked it worked out pretty well. When the mailman starts asking you about it, you know, it's it's probably probably a good time to to go ahead and
get short. Uh it has has come down a lot off those levels, but seems to have have and uh moving up a little bit today after after the good rating from City. >> there you go. Did you Did you I mean only only Did you take a look at the
they're rallying back to up 14. I don't I wish I knew it was happening. Is the war back on? >> Uh, is the war back on? Well, oil is up call spreads, Liz. This is why. >> Yeah, check and truth social. I'm all
>> I didn't see anything on my Twitter feed. I don't see a whole don't see a >> I mean, they're not down too much, so I don't think the war's actually back on, but oil reversed and this was reversed. Trump is doing a a press conference in
>> I don't know what he said. >> He's talking. Did he start speaking? >> Yeah. Yeah. Yeah. Well, he 47 minutes ago he tweeted and said or truth and conference in 45 minutes from France." >> Yeah. Just so people know we're talking
about You see this big little gap down right here at 10 at uh >> Yeah, it was a couple minutes ago. It was while Gus was talking. I was have my eye on the spoo. >> That's you talking too. Maybe you did
[laughter] those are the those are the ideas. We >> Got them all. Everything. >> Carvana, CarMax. Cool. Awesome. Yes. always, keeping us on the pulse of what people are looking at right now. Great,
little movement in E- Mini S&P here. They're on the negative side now. Down They're on the negative side now. Down 10. NASDAQ is up 62 at 30,370 on the dot. And we got Russell 2000 still positive, 12 points up 2977. and
still positive, 12 points up 2977. and the Dow 525 up 100 points. Stay tuned. Big Fed day coming on here today. We're going to be talking about that, SpaceX options, and more. You're watching Tasty Live.
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Tasty Live and it's Fed day. I am Jamal Chandler joined by Liz Deer King and we got special guest in the house of course. Hit it. Let's go.
up, man? How's it going? How's it going? I love it. Love the from Jamal today. There was three additional ones I noticed. Jamal, >> Counting DDS now. >> I'm taking all the DD de I can get.
man? >> Yeah, good. Good. Desk is good. I've got some stuff that I want to go over today. So, first, let's talk about early assignment due to dividend risk on short calls. So, we've got SPY going X
dividend tomorrow. If you want to hop in the platform, there's some examples I can show you guys if you want to pull up the spy option chain. And so let's say like because I was asking the trade desk earlier today. I'll put out like a
out there and then people are like chomping at the bit to answer it. So like I'll put it out I get like five answers in like 10 seconds. I'm like oh like not like doing other work? You know they're like I'm while I'm taking a call
I'm answering your question. I'm like I love it. I love it. But so going over like early assignment due to dividend risk. Let's pull up uh the July 17th expiration here. And then if you go to this was my question for the trade desk
was if I am short the 7:30 call is there a high assignment risk due to the >> 7:30 call. >> Yeah. For the 7:30 call for July 17th for July. >> Oh July zero. You got to go to July.
answer? >> Yeah. She wants to tell the answer. She >> If the extrinsic value is less than the amount of the dividend, you run the risk dividend is right now, but if the extrinsic value of the option is less
the risk of assignment. >> Yes. >> The cheat code is look at the put. >> Yes. Exactly. Yes. That's what we tell a call you're short, just look at the corresponding put and then if that's
higher than the dividend, you're good. Low assignment risk due to the dividend. And then if that value is lower than the dividend payment, then you're at high risk of assignment. And then how do you find what the spy dividend is? because
it's an ETF. There's a few ways you can back into it through the option chain. You can look at like a really far deep in the money uh put and then see what could just look it up on Google. Now, I just looked it up. I think like the high
end of it is like 167 or something like that. So, if you're short a call and that corresponding put has a value of 167 or less, you're probably at high 167 or less, you're probably at high risk of assignment due to the dividend.
>> Yeah. And it and it's kind of um everybody beware a little bit because when with market at all-time highs, it's very easy to have short in the money moot point when we're not we're not at alltime highs or we're not up up. So
things that have dividends I think tomorrow, right? SPY is not the only >> I am not 100% sure. There's probably a lot of other things that are going out. that that declare dividends. >> Yeah, I know SPY is the big one that a
>> Word of Warning, right? Yes. Yes. So keep an eye keep an eye on your short in like I said, if it's >> if it's defined risk, you can just go little bit of money, but you'll you can just exercise your other side or close
>> Yeah. You can always do like a covered stock order where you sell the option, sell the long option, and then also close out the shares as well. That's >> Yes. >> And then I know you got another
>> number two that I want to go over. We've got GTH hours. Now, for SPX, you can trade SPX pre-market and a little bit postmarket as well. So, the hours are from 4:00 a.m. Central to 400 pm central. And then, if you wanted to
is Jamal, if you want to just populate like any given trade on the option chain, >> just yes, I'll call the spread. Perfect. above review and send in the bottom
right hand corner, it says trade session market hours. You can change that to 24 hours. And then you can now trade the GTH hours. So you can trade it announcements. So if you want to trade those via S&P, you can do so with the
pre-market hours trading. >> So 4 a.m. to 4 p.m. Now, my question to you is, you don't have to know the answer to this. I think the zeros the might open at 4, but I think they still close at three, don't they?
>> Yes, the zeros still settle at three. >> No, no, zeros close the zeros close at three. Everything else close at 3:15. >> Yeah. Well, now Yeah. So zero settle at 3. You previously could trade everything until 3:15. Anything beyond zero DTE.
Now you can trade everything up until 400 p.m. Central. >> Mhm. >> Yeah. that'll declare not Apple, Apple's later, but let's say let's say Nvidia
You still have S&P options that you could trade. That's pretty interesting. though, right? It's the big >> Yes, correct. You got to change the market session from or you got to change the like trade session from market hours
>> Gotcha. >> So, can can I trade a zero at 4:00 a.m.? >> Would you So, it's it's 4 So, zeros are going to be 4:00 a.m. to 300 p.m. other morning. >> Okay,
>> Huh. That's a game changer. >> Yeah. Right. Yeah. Yeah, cuz there's you're looking to sell the zero day volatility and you don't want to wait until 8:30 when the market opens, maybe you want to do it at 7:30 or if you're
able to do >> I do get up early. It's going to be me >> Well, there we go. got. >> Yeah, let's go for the 20 symbols going
through the system and their IVR at number one. That is so cool. At number number one. That is so cool. At number one, SpaceX with a 39. Tesla 23, Nvidia one, SpaceX with a 39. Tesla 23, Nvidia 18, Micron 91, Apple 33, Tle Q 71,
18, Micron 91, Apple 33, Tle Q 71, Microsoft 56, Amazon 24, Palunteer 18, Microsoft 56, Amazon 24, Palunteer 18, SoFi 21, Meta 40, AMD 86, Broadcom 32, SoFi 21, Meta 40, AMD 86, Broadcom 32, Robin Hood 61, Coug 31, Intel 84, Marvel
Robin Hood 61, Coug 31, Intel 84, Marvel 89, Netflix 84, Coreweave 34, and SNDK SpaceX got kicked off. >> Gold and silver aren't in here. >> Usually Tesla is like number one, but
SpaceX being number one. I mean, Elon's just the king of uh trading volume here. >> Yeah. One and two. What got kicked off? It is gold and silver. last couple of days. They aren't on here now.
fourletter names, but mostly four letter names. Everything on the NASDAQ. NASDAQ. Yeah. >> Yeah. That's all NASDAQ for sure. >> The market's >> CRWV. Is that always on there? No,
>> No, it's not actually. Yeah, >> according. No, but that's that's a frequent flyer though. It's not always on there, but frequent flyer. >> Yeah, I keep an eye on this. I feel like I've the stock has been doing something
recent. Something to keep. >> Hugh, great stuff, man. Thanks for coming on. Good to see you as always. Folks, that is our show. It's been a phenomenal day. Obviously, we're paying attention to the markets because we have
a big Fed meeting coming up later today. That's 100 p.m. Central time. 2:00 p.m. their statement and then 30 minutes later, Kevin Worsh will join uh the discussion for his first Fed meeting that he's going to be at. He's going to
have a statement and talk as well. So, stay tuned for that. We got a lot more Jamal Chandler. I've been joined by Liz Deer King. It's been a fantastic morning. We're watching SpaceX options. We're watching everything. We got TP and
We're watching everything. We got TP and Chris coming up next. Tasty Live.
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I'm your host, Chris Veio. He's your co-host, Tom Preston. Tom, you sound co-host, Tom Preston. Tom, you sound excited for Father's Day this weekend. >> No, I Chris, it's I can say this as a dad. You're a dad.
as far as I'm going to go with it because I don't want I don't want the whole country to hate me. I know I'm okay with a good percentage of it, but I don't want a 100% of the country to hate
don't want a 100% of the country to hate me. The point is, Chris, is it's whatever the expectations for Father's Day for me, whatever. My kids are much older than yours. They're in their 20s. You know, they'll probably call or maybe
go out to lunch or something, but the I don't have huge expectations for anything. And I still have work to do. You know, there's no day off. So, it's whatever. You know, I I'm not it's I'm happy it's Father's Day, but I'm not I
don't really care that much. >> I'll be working. >> See, that's that's the whole point is it's and that's okay. That's what us dads do. That's what we do. We work. >> That's what we're here for. Uh markets
here today, Tom. 7576. Lure. We can go to those charts. 35.2 IVR. We're in a guess no surprise given where we stand on the calendar. We're about 3 hours away from the Fed meeting. Tom, volatility here is up a touch today. VIX
is and at 1686, but it's holding >> below 17. It's lower than where it was going into the last Fed meeting. Is that enough [clears throat] of a signal? >> Yeah, it's it's it's painfully low right now. I was leaning bullish on the S&Ps.
you know, I sold put spread in the ES uh this morning. Losing a little bit of money on that and it's a defined risk trade. I don't I'm not worried about it. trade. I don't I'm not worried about it. But the market selling off here, I
think, and talked about it today with on the morning show with Liz and Jamal is I I I don't think there's going to be any surprise with the actual number. Rates aren't going to change. It's going to be the comments afterwards and the market
dissecting what those comments are. Who knows where that's going to take it. Um, and given the, as I said, the the politiza, what's the word, Chris? Politization, the newly political Fed or the much more obviously
political Fed. You know, I I think it's going to be it. Everybody's going to be looking at the exact verbiage he uses going out the rest of the year. The by the way the probability of a rate hike actually went up overnight
um for the rest of the year out to like the you know the September and and the December um uh Fed meetings the probability of going up another 25 basis points according to the Fed funds futures. So, it's people are starting to
think, yeah, maybe maybe we could see an increase in rates before 2020, before the end of 2026, even though a lot of the discussion I've heard is no rates, no rate uh increases. The bias is towards holding or cutting. Well, look,
out in real time on the platform, if it's something that traders are more hikes coming, it could be problematic for bonds, could be problematic for stocks. If the cut odds go down, maybe it's a little bit of
contract. I don't think we're worried about what's happening here in June, market pricing right now. I want to look at the year end for the December expiry. That right hand yaxis there, there are numbers on the y-axis there. Simple way
subtract it from 100. That is the at that expiration. So I have two numbers marked off here, Tom. 96 and 96.25 because that would be the 4% implied Fed funds rate or 3.75.
Obviously over the course of today's session, you mentioning that rate hike odds have gone up. We've seen the SR3 dip down and slouch a little bit the So if that were to continue today, all of a sudden we're back to where we were
at the beginning of June, right? When the stock market was in its hole at the beginning of June, that's when the market was pricing at a 4% rate by the dynamic today around that 2 Eastern, 2:30 Eastern press conference, more
importantly. So one of the points about this and bringing up that symbol is really important Chris because what you're looking at with the Fed fund with the FOMC meeting is they change they adjust
the Fed funds rate that is the overnight rate and the impact of that change trickles out to varying degrees down the down the yield curve. the three month is, you know, what we're looking at is going to be more sensitive, is going
that rate is going to change more than, let's say, the 10-year note rate yield let's say, the 10-year note rate yield or the 30-year bond yield. But those products have higher duration. In other words, they're more sensitive.
Their prices are more sensitive to a change in interest rates. They're also more liquid. I think the 10 years and the 30 years are I'm when I say easy to about. It's not I'm not talking about making money. I'm talking about
making money. I'm talking about executing trades. So, you know, I it's keeping I'm just telling everybody reminding everybody that when they talk reminding everybody that when they talk about changing interest rates today,
those are ultrashortterm rates. Are they going to have that much of an impact down the yield curve? Maybe, maybe not. I don't know. Um, but what I do know is I don't know. Um, but what I do know is LAR looking at a company like LAR leen
and LAR doesn't have great options. Um, but it's up today um pretty pretty but it's up today um pretty pretty sharply relative to where it was. I think uh the housing industry is going to be they had lousy housing starts come
out this p these past couple of days. if interest rates start ticking up again, especially along the 10-year uh note, that could be just disastrous for the housing sector. So, companies like LARian
um Toll Brothers, uh XHB, the the homebuilder stocks, stocks like that, look at Toll, look at look at look at XHB. >> these things these things these things are rallying today. Why? I don't know.
I'm I'm I'm this is a contrarian I would I would consider a contrarian bearish trade in any of these housing sectors. >> It it all seems like it's predicated on and how rates may have a chance to turn a corner here which is something I was
talking with Jamal and Liz this morning. Tom I I think this is probably the place exposure right now where I'm still mostly long deltas in the stock market. What will upset the stock market today given where I'm trading?
probably going to be something with rates or yields. So, what's the risk? Well, higher yields, lower stock prices. I should probably put something small on short term to bring down my beta weight to delta. That way, if the Fed comes out
inflation. We actually can cut rates starting next meeting. Yields are going to go ballistic at the long end of the curve, right? And that could be really bad for the stock market. >> So, the the other and I would I agree
completely with what you're saying, Chris. The other big point is we don't Chris. The other big point is we don't know the details of this Iran memorandum deal, whatever you want to call it. Crude oil is up today. The um the
Crude oil is up today. The um the inventories of crude oil have been dipped down. We got the um EIA report this morning. Uh US crude inventories were the lowest they are. I think it was six years I think I read. I know they're
low in the OPEC countries. So there's this bias towards and I I bullish positions, full disclosure, bullish positions on the CL. That said, I think positions on the CL. That said, I think that is a risk to the market that is
it's not immediate like this like this FOMC meeting, but I think any increase in um a bounce in crude oil um anything like that could start uh could start >> Yeah, I mean I this is a great chart. This comes from Josh Young over at Bison
Insights. Uh oil guy. This is the US big force storage crude with SPR, gasoline, distillate, and jet fuel. >> We are here. [laughter]
to be in the Q6 contract, but when I look out to like Z6 for example, uh right now, and that's a long time, and locking up capital for that long for a But what are what are the odds that we're going to see the market continue
to draw down these inventories, right? If the inventory draw down stops, it rebuilt. It means there's going to be excess demand for crude for a little put spreads here, looking for some long deltas. Uh to me, 7D seems to be a
that's so far away. Most traders are DTE, what have you, which I suppose brings us >> and I'm in the Q contract. I'm selling I'm short some of the the closer stuff.
I'm thinking about this potential, you know, what does a hedge today look like around a Fed meeting given I'm trading long Nvidia, CRM, SMH, NASDAQ, right? Uh
one day to expiration. This is purely this is not a typical tasty trade, Tom. This is purely thinking about what goes into the book today to potentially clip into the book today to potentially clip the wings of bigger losses. U the 109
put one day to expiration here in ZN is going to cost me $1563. >> Yeah, I mean it's again I know you love your long options, Chris, and I I I shed
a tear an invisible tier every time I see you do that. I would I would lean towards maybe selling the the 975 1025 call spread, something like that. The problem is the premiums are aren't huge in these
things right now. Volatility is relatively low in these in these bond products. That said, Chris, note volatility is relatively high note volatility is relatively high compared to uh bond volatility. So, the
10-year VA is a little bit high relative to the 30-year VA. >> It's a minus 2 IVR right now for >> IVR. And just looking at the raw volatility numbers, if you go to the trade page,
what I look at is, and you know, the one days don't really count, but it's like eight, you know, eight and a half or so compared to the um the ZNS, which is about uh 4 and 1/2, [clears throat] 4 and 1/2 typically.
Typically, um bond volatility is about two times higher than the note volatility. It is not right now. It's less than two times, which is why I suggest that note volatility is relatively high. And if you're going to
sell premium, do it in notes, not bonds. retail traders as well, given their >> I agree. And and really that is that's >> I agree. And and really that is that's the benchmark yield as you know. It's
that's what drives the real estate market. That's what drives so much of of retail interest rate stuff. There's people the the these these organizations these companies still hedge with the 10 years. So you know one stock that
there's a couple of stocks coming just at before we close out CME is down big >> Another day >> CBOE was down CBOE was down big >> CBOE was down CBOE was down big yesterday. I'm leaning towards maybe um
getting long some deltas in these in these exchanges given our trading activity, given the rise in yeah, just just the overall trading activity. And I I know they're down for a variety of reasons, but um with these IV ranks,
reasons, but um with these IV ranks, they're crazy. Robin Hood up huge. Robin >> Good day for Good Day for some of the brokerage stocks out there. Yeah, these going to have to get into them a little bit. They kind of remind me of CFDs in a
>> Um, which aren't tradable here in the US. You can trade them if you're over in the UK or Europe. But it it's an interesting product and I'm hardressed to think why wouldn't CME and SIBO offer these as well given their structure.
Hey, Chris. I I I I don't know because the CME and the CBOE have the finances to fight any legal challenge they want.
What do I mean by that? I've been involved with I've mentioned building exchanges you know building the smalls exchange and the difficulty in product exchange and the difficulty in product and licensing and laws all that
[clears throat] is hard to overcome >> that those figure out how to get involved in a bigger way they would figure it out the they have the legal weight to fight
anybody money. >> They do and they're not going to give up market here and really it feels like it's just a round trip for a few weeks here. SIBO's back to levels it was trading back in midFebruary. Tom, I know
we're going to swap you out of bring in Glenn Glenn F as his friends call him. Glenn Glenn F as his friends call him. Tom, we'll catch you later. >> Glenn? There he is. You ready for today's Fed meeting? I'm so excited. I
>> I'm kind of nervous, you know. It's a like new teacher, you know. >> Oh, true. Yes. The new the professors here. Stock markets have been oscillating back and forth. The S&P for what it's worth. 356 down by seven
points or so. The world of FX here is a little bit warmer today though. I'm up ahead of this Fed meeting. There's been a bump in rate hike odds, however, marginally, over the past two sessions. What do you think that we should be
doing here looking down the pipeline to what new Fed chair Kevin Morris might >> Yeah, I mean dollars creeping up to no real uh substantial degree, but still nice to see and and interesting to know which way we're kind of sliding into
this decision because like you said across asset classes, we're waiting on this decision uh a bit subdued here early in the morning. Um what I am looking at to continue your discussion on rates and and those impacts uh
specifically within the bond market just hold some uh numbers around one month correlations for if you are getting granular in uh trading spot FX or even
granular in uh trading spot FX or even FX futures uh where do you look if you know the the main driver will be uh around this rate story line and the good news is you don't have to look very far. I historically we've had um you know
dollar yen is is one of the more popular products to look for correlation to rates. This time around we're seeing the euro dollar and and the pound dollar euro dollar and and the pound dollar move in tandem with uh the the rates
over the past month or so. Um I don't see a large case for why that would decouple today or or tomorrow in the short term. of course over the long run short term. of course over the long run as uh this story es and flows uh perhaps
that correlation does break down but why I bring that up and and why it's nice is this Euro dollar not only the the most popular pair to trade one of the most
liquid one of the lowest margin rates on the spot effect side and you're not getting uh the kind of counterparty event risk in the form of uh an upcoming
central bank meeting from M ECB had it last week. If you're looking at the pound, uh you're rolling this Fed meeting right into a Bank of England meeting, which of course you could play to your favor. But if you're just
looking for this, uh, you know, dollar exposure, I see no real reason to look farther than this Euro dollar, which is a good sign. It's been very compressed as of late. Stuck to this 116 level in the spot market.
um a little bit of downward pressure today. Uh but that's where I'm looking. Is that making any sense uh on your >> No, it makes uh makes zero sense. Glenn, makes No, that makes a ton of sense. You know, I'm just running some correlations
here across the board with like two years and 10ear yields versus Euro a lot of them are just kind of flat right now. >> Yeah. Um, and it's almost like to say that the market's been ignoring the rate
today's probably going to be a turning point, right? You obviously got to keep an eye on the euro. It's 57.6% of the dollar index. So, as it goes, so goes the broader dollar complex. I feel like you have to just be directionally
agnostic here, right? Maybe the options are a better way to do this, but this has been chopping around for how many weeks right now? Euro dollar spot since the end of Well, this is actually what a weekly chart. So, we're talking about a
year at this point. We've been going up and down slinking between 114 and >> that's really difficult to play in the short term if you're going to be a spot trader in my view having you know done spot for a long time.
average envelope as a momentum trade or do you wait to buy a dip down towards 114? So in kind of that omnidirectional sense one way to go about this we're expecting some semblance of a move here. You could do something like uh a reverse
iron fly. We talked about this recently here, but a reverse iron fly is effectively buying the at the money call and put and then going out and selling down selling the 115 and we go out here and buy maybe back the 118 and oops,
in the neighborhood actually a little bit better of than a 1:1 risk-to-reward ratio with greater than a 50 58% probability of profit. So rar occasion you get higher than a 50% pop um alongside something like a better than
one to1 risk-to-reward. The idea here is that EUR dollar needs to move. It can't get pinned close to 116. It's got to move away from the center point of its think, is a little bit more difficult to
crack because there's no range trade, so to speak, that you can put on to stay penned or move away from the current point without potentially picking the wrong direction. >> Absolutely agree. I I do see what I have
seen recently in the spot market when you're playing more of a a dollar denominated story is you can get depending on the the the different tape action you're looking at you can set up kind of a riskreward that's favorable
from a a tape action perspective if that makes any sense. I mean, of course, uh these markets can go anywhere, but um if you're looking at a a dollar, Canadian dollar, and you're looking to get short US dollar, um that chart sticks out to
US dollar, um that chart sticks out to me because we're pushing into uh new year-to-ate highs that we tried a couple times um over the past week. I only say that to call out. um if you are looking to get short US dollar there, you know,
pretty quickly if you're wrong. Um trading into these new highs, um and trading into these new highs, um and then a lot of potential downside if we uh potential upside for your position, downside in this market if we retrace
anything there. So that's how I'm looking at at at the US dollar tapes from a a granular perspective. But you're absolutely right that um if you're structuring a a nondirectional bias um that Euro dollar's looking good
bias um that Euro dollar's looking good and bad. Good because uh we have recent history of of it falling away from this 116 level, but it likes it a lot. up dollar CAT here. I have a weekly chart up here on the screen. It's made
an important move. And for those that you know um aren't so privy to FX there is this relationship where dollar CAD because it is u such a both countries are so closely tied together economically uh people view dollar CAD
broader dollar complex not dissimilar for what happens with the euro pound uh pair and so to that end the fact that you do have dollar CAD rising right now it suggests that you may be going into a little bit of a tighter financial
we're keeping an eye on that 10-year yield today because if the 10-year yield dollar is somewhat positioned to take advantage of it. When you take a look at the charts, um I FX though, the volatility, where would you affect a
trade like that? The euro probably, you know, 62.8 IVR right now doing a reverse iron fly is usually best when you have a low volatility and you're just expecting things to explode. Putting it on when volatility is already this high can be
expensive. So choosing your product fit matters more than it usually would. Uh that's why the yen actually is the most fascinating thing among these among these grounds. I know that I'm looking at my little 0064 long call just in case
they intervene. But what if they don't intervene? What if the market just starts to run from here, right? And if it breaks through 160, I'm of the mind the thing is just going to explode towards 170. So this feels like the
better place to do something like a reverse fly if we want to play that buying power. It's still better than 1:1. In fact, the probability of profit here is increased given the current strikes that are laid out. And 59%.
Still pretty good. I I like this at 51 days to expiration. Something's got to month and a half. There's no way we stay pinned at 160. There's no way. There's no way. So I'm I'm going to put this on
the Fed meeting today. >> There you go. Yeah, that the the one call out to make with trading these these yen futures options are uh you know the the market hours and just being wary of when you want to manage these
trades because um you know best case scenario you get filled right now you get a move right after um our new friend Kevin W starts speaking um you could
want to take that off immediately um during US market hours not and give the during US market hours not and give the Asian session time to react. Um, and and on the opposite side, you could get a move in your favor during the Asian
session and have to be waiting all of those hours to uh try and manage this of. But you're absolutely right. Uh, we don't stay we haven't stayed at this current price level for long. Uh, even though we've hit it numerous times now,
though we've hit it numerous times now, 160 very normal over the past year, year and a half now. but should be super interesting. Excited to see what and how much our new friend Kevin Walsh says later this afternoon.
>> Hilly and I are going to be covering the Fed meeting today starting at uh 1250 about 20 minutes. We'll bring in Tom Preston to go over the trades then once we get a breakdown and lead into Gus and Earl uh ultimately for some scalping.
today. Until we get there though, 75.81 points. The market is just chopping around as we wait for our new boss friend Kevin Warsh. Purple tie time to buy. We'll find out in a bit. We're
Tasty Live. Gus and Earl going to be back shortly. Glenn, thanks for joining back shortly. Glenn, thanks for joining us. See you after the break.
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Oh yeah. >> [music] reward. I would love to say that it's the middle of the week but as we traders know it is not. We have a short week this week with Junth this Friday. So it
joined as always my wonderful co host Errol Coleman who's looking sharp who was doing red shirt synthetic Thursday today if you will. How we feeling Earl? >> We'll take it. Uh red shirt for a red day on SpaceX so far today. Uh sold a
State Farm comments a few times. [laughter] You saw take it. Uh no, I'm is the second day that options are being traded on SpaceX. Uh I haven't dabbled myself, but being the first week uh the official full week for SpaceX to be out
take a few positions. So, I'll be keeping everybody posted whenever we for two or three Halloweens in high school. Did you really? Cuz it was so easy. It's just khakis red polo and I just slap a my name is thing on me and
wasn't it wasn't like a copout. People were like, "Oh, he's Jake from State Farm." Yeah, it's right there. >> Everybody needs a free Halloween costume equipment to be Jake from State Farm in your closet right now.
Paulies closed. Absolutely. If I see a Jake walking around. >> Great branding for that brand. >> It is. It is. >> Did you say All State just now? Cuz you must know that you're saying all All
general got good branding right now. I love the Liberty Mutual commercials with >> They got uh Liu Emu and Doug that it's the emu the guy in a yellow shirt. Those front of the Statue of Liberty that just says Liberty Liberty over and over.
that guy. Uh we have an exciting show planned for you guys today. Uh in about 12 short minutes, we will be joined by Andrew Rder, special guest, options afficionado, gamma exposure afficionado. We're excited to have him on. But before
your positions and today's market action. Uh, we got the Tasty Trade platform pulled up here. I guess we could start with SPY since we have that pulled up. You already know the go-to, but we got
regular S. Um, we're getting a little bit of a sell forth action. Uh, a lot of I don't like to use the word manipulation, but a lot of clear a lot of clear liquidity grabs clearly on both sides of the market. And
that's to be expected, especially with something like uh FOMC coming up today at 1:00 Central. So, it seems that a lot of capital is probably on the sidelines definitive decisions whenever that announcement comes out. So, that's kind
of the market that we've been trading in today at least. You know, very choppy very prominent highs, some very lows, and then pretty much reclaiming and recovering back to pretty much near
pretty much been the story all morning. Very choppy price action. If you're Very choppy price action. If you're intraday trading today, uh it's it's one what the market gives you from a shorter duration because we can't expect any
duration because we can't expect any type of full uh continuations. we get. Uh today is going to be the first day that we have the new Fed chair about that. I know we were talking about how Jerome Pal became a little bit of a
in? Are you excited just to check out his uh his presence in person? >> Yeah, I just think this is a a spot where, you know, as a trader, a little Shake it up a little bit. >> You're kicking Jerome Pow to the curb.
>> Interested to see what the what the new memes bring, you know, bring on. It's it shakeup. I wouldn't say I'm kicking Jerome Powell to the curb. Respect him pretty good at the job. As many memes as there were,
>> Yeah, he did. But it's uh Yeah, little little shakeups fun. keep things lively. Tune in to the Tasty Live show Instagram later today to see Errol and Jamal live. >> Yeah, we will we'll be having a mini
stream there. Um but yeah, obviously market sort of just uh in in a holding pattern here as we as we await uh what what the new Fed chair has to say. Um I don't believe that there's it's not in the equation at all that he could he's
>> Yeah. May maybe he'll be holding him there. I that's going to be the consensus going into it. Maybe we get a surprise. Uh I don't know. volatility uptick in just a bit there as headed up to this binary event.
Volatility sitting at 1681. How are you kind of uh viewing volatility right now last few days? Finally. >> Yeah. Um I mean again I mean I'm just not it would be hard for VIX to do anything that could that could surprise
me at this time. Um you know and I mean not surprised to see us climbing up a this is a little bit more of a jump in VIX than I would typically expect uh from, you know, the the very slight downward action that we have going on
today. Uh but I don't know. It's it's said, I don't really pay attention to volatility until it's over 25 in this off that same idea with volatility right now. Just kind of kind of waiting on it
funny because again when volatility was trading at around like 20 2122 I was do something and then it uh it contracts very aggressively. Now I'm like okay well I guess we did have something and now I'm really waiting for volatility.
take to spook the market. Uh I don't know a surprise announcement with the little bit. I doubt we get a surprise announcement but with that being said volatility is sitting at 1680 right now. Um, and again, that's relatively still
high uh for what we've seen in the past, you know, prior to 2020. Again, I I know kind of spoiled with the premiums and volatility we've seen after 2020. Uh, that's been trading over the last couple decades, they'd still tell you 167,
what they've >> Yes, it's uh it's just Yeah, it's it's what we've become accustomed to. And the goalpost just continue to to move higher >> They do. My laptop has decided to take an OS update right now. I I [laughter]
staring at a at a black screen with a with an Apple on it. >> That's hilarious. No, I always I always press delay. Delay. I'll do it tomorrow. I'll update the computer like two years straight. No joke. And then I'm
>> Yeah. Now it's just brricked. The Apple logo went away. There's nothing here. for the guest on it. So yeah, we're going to we're going to have to just off dome. We'll we'll see we'll see what we got. Got you.
>> Um, you're still short the QES, I see. >> Yeah, I am still short the Q's. Um, sold Uh, again, sold the 755s, bought the 760. Uh, we collected about $169, so just about three pennies over a third of the width. I'm pretty I'm pretty uh I am
pretty uh what's the word I'm looking for? I'm pretty meticulous about how these things. I really don't want to go underneath a third of the width, right? Like a $166 is really the sweet spot. would love to collect more, but anything
going to be as worth it just because again the less credit you you take upon a defined risk trade, the more risk that you have overall. It's like the more credit that we can receive up to that $5 with the better. Um 50% uh you're you're
then you're obviously you're playing with fire a little bit there, but it is bit of extra reward. Um, some might argue just sell the strangle, just sell an undefined risk, get a little bit more profit under your belt, but uh you can
always sit very comfortable in these swing positions when it comes down to uh uh trading the broader market at least. So, we'll keep an eye on QQQ. Um, and as before we have our guest come in and join us here in about a minute, check
out SNDK. Um, it's it's funny whenever we bring this up, it kind of surprises me how impressive this move has been. I'm still going to be patient to get on any type of short delta in here. Uh but SNDK and in Micron still putting in legs
to the upside. Um and it's not really proven any type of backside just yet. So kind of what's had my eye. And lastly, before we pivot here, we can take a your guys' thoughts on oil. How are you guys kind of positioning right now? I
know we had a lot of uh we had a lot of traders in the Tasty Live community already getting a little bit more short delta onto the downside. Now that we've to the downside and we've even took out yesterday's low. Put in a new low for
now. Uh but I'm looking at a little bit of long delta. I want to get on a little bit of long delta. Might you might use USO to get a little exposure to the oil market there. Uh but let us know how you're kind of uh viewing oil right now.
I know there's still more headlines coming out about how things are okay with Iran and it's allowing a little bit more air to come out of these oil names. oil definitely seeing a little volatility to the downside though.
we are we are ready with our very special guest for today. We can bring him on in. This is Andrew Raider. He is Raider Trader on on Tik Tok. >> Good to see you. How you doing today? >> Good. Doing well, man. Exciting market.
>> Yeah. Andrew, uh, you you want to you want to do the plug yourself or would >> [laughter] >> Uh you can do some of it and I'll finish that? >> Sure. Uh Andrew, he he runs uh the the
raidertrader.com which is a a website uh predicated on the idea that options pricing increasingly drives the the pricing of the underlying asset, not the it pertains to gamma exposure. He has a ton of uh very cool proprietary tools
add? >> Yeah, you did one correction. It's the >> Yeah, you did one correction. It's the >> radarreport.com.report.com. To build on that though, um there there's a lot uh to kind of what I've
done in my life. I'm very young, but I really did start out with a focus on options. Uh you know, when I first got into trading to begin with, uh a big second. You know, if you're talking about trading, there's this really, you
know, everyone was like, hey, trade equities, it's safer, all this. But when you look at it, if you're a trader and you have edge and edge is only within a defined time window and you believe you know this is going to play out during
this time window, then there's no better asset or you know uh way of playing so I was really interested in that and research I was able to develop a few different tools uh that I think are
unique to this industry but also um just build off of knowledge and take it get to a professional level as far as how I trade with derivatives and and stock >> yeah. No, that's that's awesome, Andrew. And I'm also curious. I know you're kind
of an options guy yourself. What kind of got you interested in getting a little bit a little deeper in terms of option flow and gamma exposure? Yeah. So I mean over the last uh 10 years even you know you do a lot of
reading of what options are you know and there's a few great pioneers in this industry. uh there's people like Jim Carson and other voices to help point people towards this growing uh you know not problem but growing uh you know
influence of options on the underlying market that even Charlie Mer and Warren Buffett have made comments before regarding that they believe options they're starting to take over the market and uh to some degree influence them way
market and that's you know I'm sure a lot of your viewers know already but the exponentially growing. As product issuance grows, as you know, the demand from institutions to hedge these massive long positions grows, you need more
options. And with that demand for options, you have a bigger need from market makers to influence the underlying price because they need to, you know, hedge out their risk for pro providing the supply of options. So,
there that that uh ultimately has has influenced the markets. curious again with the options flow. products you like to view the options flow from? Is it usually the indices
like QQQ, the ETF for NASDAQ or how do you kind of you know view the options necessary liquidity that makes it attractive to view that gamut exposure? >> Yeah. So when I first started out uh
with the big names and names like Nvidia, Tesla, etc. But what you then realize is that individual orders on stocks like that are far more impactful or less impactful than something which has a massive derivative order on a
volume. Uh so there's this really interesting dynamic of well how do you balance that between one big large order and you know the the market cap of the stock. But over time I've really narrowed my focus to kind of what I
expect flows to actually do. Uh I mean a lot of people look at individual orders. There's a lot of services like unusual whales or where they track political um or even just unusual option volumes. What I typically like to look at rather
is just the um you know and this is what I kind of built a tool around was basically looking at the total flow volume. So, uh, and ranking that against historical readings of that stock because that way, you know, a $5 million
order on Tesla is not going to be the same impactful order than a $5 million order on something like Kohl's, you know, KSS where there's no option >> No, didn't mean to cut you off. I'm sorry, but if if you don't mind,
little bit of the sauce. Give us just an idea of some of those playbooks that you I assume you use some of those tools that you like like gamma exposure more confidence and conviction in terms of what you're doing. But what does a
playbook trade look like for you? >> That's great. Yeah, I mean there's a you a time relevant one and then I'll kind of give you another maybe a more uh yesterday, you guys know that options were introduced to SpaceX yesterday. Y
and uh there was a big runup into spa SpaceX and because of how big of the runup was, you guys saw in the after hours that it spiked to 230 after already 2 days up. It hit that $3 trillion market cap in the after hours
and then we opened right around 2:15 at 4 a.m. on SpaceX. Well, a simple playbook there with options is just simply anchoring in the idea that with simply anchoring in the idea that with options now unlocking you have uh a lot
of people institutions who are unhedged who are long SpaceX and hedge funds who are buying them would like to hedge because it's up so much. So the thesis people to buy puts and that's going to drive a lot of selling pressure because
again when you as a participant go and buy puts market makers sell you that put and they have you know naked exposure to that put which they can take an infinite loss on. So they have to sell equity to hedge. So that creates selling pressure
on the market and you know the thesis yesterday which was actually a PR trade yesterday which was actually a PR trade in my career was shorting um SpaceX uh to to have that. Now there was that first move up that squeezed everyone out
but on that backside you can see even today it's just melting melting melting lower. Uh and that's again just a very simple playbook of with IPOs in the anthropic coming up you can deploy this idea and really look for you know if
there's a big runup into these option unlocks there is a very strong case to say that they could go down. >> I love it. And uh you know zoom zooming are are traditionally the the focus of the tasty audience. But as your research
increasingly drive price action rather than just reflect it. Do you think we're wagging the dog here? And if that's the case, what are the implications for >> Yeah, sure. So I think this is situational. Um you know there is
increased magnitude of uh I guess impact during certain market environments uh in lent others. So, for example, when you're in a market where uh you know, I'll give you this will kind of lead into another playbook, but I I think
we're not quite to the point where the tail is being, you know, the options are fully wagging the market per se. Uh because at the end of the day, it's ultimately about stocks and where options really is not only boosting the
volatility of these stocks, but adding, you know, a little bit of a deeper layer of information that you don't get otherwise in the uh equity market. So, other playbooks I was going to tell you guys about is just really simple. It
actually worked out on June 5th, um, on SPY where it it's super simple and I, uh, you know, you kind of just expect, it's called what I call the the Jex flip in a market where it's just positive gamma, positive gamma, positive gamma.
So, you know, 10 20 days in a row of the market's really healthy, really green indices and positive gamma, their ranges are compressed and they're just climbing higher. all of a sudden after you know a 10 20 day period you'll see one day
whether it's a catalyst like it was on June 5th kind of gap it down below the negative gamma jex flip and when that happens for the first time in 10 to 20 days what you actually get is a very simple playbook it is in the morning you
want to look to short pre-market lows you want to look to um you know buy uh basically short anything with zdt puts or uh with equity short a pre-market low or first opening drive or or break and and then into the afternoon. This is the
one I like with zero DTES is taking an afternoon roll. So oftent times you'll open or below the JEX flip and then it'll start to roll over into the there is that in the morning you'll see that IB spike uh into the afternoons
volumes decrease all these zero DTE start to decay causing a bounce market makers buying back equity and then as those decay happens that afternoon roll can give really great prices for zero DT options uh because they actually decay
often more so uh than even they were at the morning. So you get the same price but a cheaper contract. Uh really really simple playbook there but yeah that's Yeah. No, Andrew, I had uh I had actually peeped some of the some of the
uh entries and exits that you took on SpaceX. I had seen that screenshot. So, scalping opportunities if the volatility is there or how do you how do you view that? Is that accurate? >> Yeah. So, we uh you know, trading at a
different strategies you do. You know, you're expected here to trade um a variety of strategies for based off what the market environment is. And something like SpaceX is not a you know you you can't short this as it's going up uh
three days in a row super strong and expect it to go down to zero. Uh so it is a move to move trade there. And so the best because we didn't have options we have to really trade that with equity. But there are instances in
something called a hedge trade where for example on car um what we'll do is grab believe car as you could kind of see it break through 200 300 you know it's
eventually right it's going to come back to earth eventually and because we know that what we can do is throw on some calls and say we're going to be long now it's a bad short we know it's a bad short we know what a good short looks
like and so what we'll do is we'll be long calls against short stock when it starts to turn. And that way that we have protection um and that we can actually when that finally unravels the car, we can load the boat short with
equity, still have a cushion of calls and then be be able to sell those calls to to have a bigger stop. So, uh that's kind of the different dynamics we'll do. But yeah, most of the time we are uh scalping intraday, but the the big
>> Oh, that's awesome. What what's kind of the thresh I know I'm pulling up pulling we had that kind of parabolic move and then that blowoff top >> um what is the threshold to start buying these calls to start hedging that
position when understanding that the the top could be near right we don't know ex the threshold for when that hedging becomes a little bit more attractive yeah so it's really interesting because uh you know when you talk about a
for any traders is to have a uh the best examples you know go gra go out and grab 10 20 30 examples of how this trade plays. So, for example, this was a daily recall different setups such as um silver, such as circle, um such as uh
you know, even prior names like MSTR in 2024, these playbooks, what you'll find is in the final innings often of these daily overextension shorts is you get kind of looks like a cellular service on your phone. Expanding price and volume
starting to go parabolic. Dollar volume is increasing at higher prices. And once that starts to happen, once implied volatilities again with options become so unsustainable, the argument for a top becomes stronger and stronger. And so
for something like car, what actually happened was or even silver, this is a great chart, um silver or gold was you had the biggest gap in the last four days. Um you had just a tremendous blowout of that first kind of red day
and that was like, okay, this is pretty crazy. having the biggest gap, one of the biggest gaps in the trend so high up at these altitudes is a big sign of you're looking, hey, you know, how can I position into options short now that you
were long calls, but specifically for when we're deploying long calls? Uh it's like buying highs and we're like, we have to have an imagination because you're buying calls at a really uncomfortable place, but that's where it
of people are expecting to continue higher. Um but yeah, as far as where we're looking to hedge, it's really when those big gaps come in, when huge volume happens. And in the case of commodities, oftentimes the moves were after hours.
early AM or RPMs. >> Absolutely fascinating. Yeah. And I as well circling back a little bit more into your framework, but uh you know, gamma exposure, open interest, these things are becoming more popular. And as
think that there's any risk that your edge gets arbitrageed away? Like what at what point would you would you begin to rethink your framework on those things? >> Yeah, what I like to say is that I I believe that options data is incredibly
powerful. I think some of it can be turned into automated strategies or at least uh you know, but what what ultimately to me options data is is a tool in my toolbox. So for example, open interest, what what can open interest
standpoint? It can give us levels of importance. It can give us uh locations where we can expect uh maybe a turn or something like that. But what it can't biggest open interest strike every time and make money. Uh we know that doesn't
work that into a different playbook, a broader playbook. So for example, if can I work options data into it because it can give you a lot of data? Well, for which was recently breaking out into all-time highs extremely aggressively,
you don't have any frames of reference for technical analysis to the upside. And so, you know, there's no equity volume you can really see. So, what are levels? Well, definitely the options position because that can give you a
otherwise get in the equity chart or the price chart. So, uh using options like there's a few things in the market that will never be uh edged or eroded away rather. Um and that is human psychology. And you know, that's going to stick
working forever. If the stock is on a catalyst and it's a good one and people institution is out there, they're not going to be able to arbet out. And so for stuff like options especially, options are always going to be mispriced
in some areas of the market. Options are always going to be uh the the best vessel in in underpriced for what could actually happen in the future because it can't see everything in the future. Um, so things like open interest, those and
even uh like option volumes, those are those I think are here to stay and you them and and not worry about that. >> So what you're saying is human behavior over time. >> That's for better or worse. Uh you know,
that's something we we talk about all the time is it's all the markets are just one big psychological thing and human psychology is is never going to upside all the time. We exaggerate moves to the downside. Quickly, I know you had
points or some of the criteria that you'll have for some of these playbook trades. You mentioned dollar volume for a moment. Is dollar volume something you parabolic type moves? And then also, are you just taking the average volume
traded that day multiplied by uh multiplied by the average price traded or what are you looking at there? >> Yeah, there's there's a few simple ways you can do it. You can literally just do dollars the stock times the volume
from VWOP like what was the shares traded at VWOP. um and things like that. I think, you know, to keep it simple, dollar volume is just an idea that, you know, you're trading big volume at higher prices. So, if you have a day
with 10 million volume and then the stock's at $100 and then you have, you know, uh it goes up to $400 the next day, but it only did 8 million volume. Well, just because it did 8 million volume, it did less volume. The dollar
it was way more because it's four times the price. So, it's harder. It's even though it did less volume, it's still harder to sustain. It's extremely not a lot of traders look at that, but you know, just to keep it simple like uh
you know, something like uh silver or SNDK had this very situation where prices. If you want to short something that's going up that much, you would, increasing because ultimately what a daily overextension short is is
unsustainable price action over a certain period of time. So, what is unsustainable? Well, you have to define that and it can be easily defined with volume and dollar volume. >> Yeah, absolutely. Absolutely. Yeah. Um,
can keep this brief if you'd like, but uh options volume and structured product product issuance have really exploded over the last decade. What's one market that simply didn't exist 10 years ago because of because of this explosion?
>> Um, I would think just the pure the the pure violence of momentum we're seeing. breakouts. I mean, think about this. Like, we're seeing some of the biggest companies in the world make hundred plus billion dollar moves and and breakouts
in a matter of days. You know, it used to take weeks for something like ARM to get to those prices or it used to take weeks for memories to explode that high. And if you miss that 3 to 4 day window, it's it's over. So just the sheer
it's it's over. So just the sheer opportunity uh that we're getting now is of what you can make in multitudes over a shorter period of time is insane. Um lot more traders. I mean even if you guys are into like the market wizards
books and stuff, you're seeing a lot of people uh become breakout traders and make an absurd amount of money. I mean I think Qualamagi made 70 million within nuts. I don't even documented that last eight months. He documented eight months
>> and and it's all breakouts. It's all because these breakouts will work, you know, in in four or five days and give you 20 30 R and it's like you just didn't get that back then. Um so that is the blessing of options, but also the
curse of that is, you know, if you're wrong, um you you lose very quickly and >> I know we only got a couple minutes here left. Uh were you able to check out the new market markets wizard book that just dropped uh over the last week? Uh there,
>> Yeah, I'm actually I'm still reading through it. Um, I will say some standout people in there that I really love. Uh, Lance, we work closely with him at our is is >> if you don't mind, what firm are you at
where is he? >> Uh, SMB Capital. >> He's an adviser for SMB. Yeah. >> Oh, okay. I I knew he was an adviser for Trillium and SMB, but I didn't realize you were SMB Capital. That's awesome.
there at the desk. I'll have to reach out after this. Yeah, he's really cool and uh you know just a ton of gems in there. One stand Simon Russo. Um now that's a fake name. That's not actually his real name, but
if you actually go to his memoir, simon Russo.com, he has posted some of the best trading literature as far as psychology and everything like that. I would 100% recommend everyone after this to go read this over the next few
taken extensive notes over it and this guy gets it. He gets human psychology. And I think you guys will read that and be very refreshed because he tells it in a very interesting way. Um, so that is some of the best trading literature I've
recommendation. I do have one more for you. If we could we keep it quick, you >> If uh if you could only look at one market indicator every morning, what would you choose and why? >> One market indicator uh probably every
day, you know, not a lot of people talk about this, but very simply, where is the market? Um, you know, people want to talk about, you know, put to call ratios or, you know, even like where where the MACD is or even market breath, but very
simply where the market is. That's like the and it sounds barbaric and super now, like for example, where the market is right now, would I want to go and everything right now? No. We're still below all-time high. We're still, you
know, in this in this mess. We still have Fed coming up. So until that clears, I don't really feel like there's opportunity in taking these big breakout trades yet. But when the Fed clears and you see maybe the market gap to 760,
what is the expected value of taking breakouts then? Well, it's much much higher. Uh so just basic indicator, where's the market? Are we from highs? climbing to new highs? That validates everything.
>> Awesome. I heard expected value. You're definitely an SMB guy. Expected Lance I hear Lance in my ear right now. It's it's a it's a Lance it's a Lance >> Well, that is uh going to be all the time that we have for you today. Thank
Andrew. >> Yeah, I appreciate you guys having me on >> Yeah, that's Andrew Raider. Raider trader on Instagram and Tik Tok, the out all the wonderful tools that he has there. That's all the time that we're
going to have for today. We will be right back here on the network uh later Time. Be sure to come hang out with us. Like and subscribe to the Tasty Live we have coming up next. We will see you guys next time.
>> Thank you. Thank you. >> He's an actual
Spievac, head of global macro here at Tasty Live. Joined by who I think is perhaps only our second repeat guest here on the show. Rick Rule is once again with us. He's the founder and CEO of Rule Investment Media. Rick, welcome
>> Pleasure to be back with you. Thank you. Rick, I've saved all kinds of hard questions for you since our last conversation, and I wanted to go right to the dollar and gold, which we uh explained last time uh how it has been
that since the beginning of this war in Iran, we've had of course an inflation scare and against that backdrop, interest rates have come up. And so contrary to what people might have thought episodically, the dollar is up
because there's been a reach for liquidity and higher rates and gold is down because things have sold it uh to gain that liquidity uh and gain exposure gain that liquidity uh and gain exposure to those rates. I want to keep that
conversation going. Obviously, this inflation scare is now impacting the broad range of markets. We're seeing it in stocks. We're seeing it in all manner of asset classes and I wanted to see if in your mind this is an input into the
larger gold conversation. Obviously people have looked uh at gold as people have looked uh at gold as something of a value hedge against uh fiat currencies being hampered by tremendous levels of debt across most
large governments, not just the US certainly and not just Europe certainly. certainly and not just Europe certainly. Uh and so I wonder if this kind of inflation in your mind in that it inflates the debt away to some extent uh
inflates the debt away to some extent uh if that hurts the long-term case or changes the long-term case in any way for gold and precious metals and kind of physical value as a counter to fiat in general. I think a study of history
general. I think a study of history would suggest that fear of the decline or in certain cases the decimation of purchasing power held in fiat instruments has been responsible for most gold moves over the last
for most gold moves over the last thousand years. Uh people uh attribute thousand years. Uh people uh attribute all kinds of uh attributes to gold. Uh all kinds of uh attributes to gold. Uh what one finds is that as an example
other forms of fear uh war, political unrest, things like that uh have a to have a negligible long-term uh impact on gold except sometimes for
participants like refugees, the Jewish community, the Vietnamese community. Uh gold. It wasn't speculative, it wasn't investment, it was survival. But for most people in less dire circumstance the primary motivation for gold is to
the primary motivation for gold is to shield one's savings from uh the depreciation in the purchasing power of the currency. It's important to note as a student of fairly recent history that is to say my lifetime uh
that reaction to inflation uh takes place over longer periods of time. uh as a very young man uh I began to notice and become interested in uh inflation
and become interested in uh inflation literally in high school uh in 1968 uh I began reading uh what are now regarded as Austrian economics or hard money books and I would suggest to you that although inflation was a topic on
people's minds that the investing public didn't really begin to react to didn't really begin to react to incipient inflation till 1972. In other words, there was a hiatus between the point in time when academics
and politicians described inflation and the time that people began to react to it. During that 5-year period, as an example, uh a hamburger at McDonald's example, uh a hamburger at McDonald's went from 20 cents to a buck.
uh uh by the next year with the Arab oil embargo, the price of uh gasoline went from 25 cents to a buck. In 1968, 1969,
1970, despite the fact that we were undergoing inflation, investors expectations of the future were set by their experience in the immediate past. And the 1950s and 1960s had been very good times.
good times. >> Uh people were extremely optimistic. you your older listeners will remember things like the Nifty50, uh, which is to say high growth stocks that did extraordinarily well. When your
anticipation of the future is set by your experience in the past, and your experience in the past two decades is rosy, uh, you don't react to negative stimulus as well. So, it took probably five years
for the population to react to incipient inflation. And I think the same circumstance is happening today. Uh exactly the same circumstance. Uh we have lived through what I believe is the most benign economic climate in human
history in the period 1982 to 2022. People's expectation the future is set by their experience in the past by the dips. Uh believe government inflation
numbers like the CPI. uh if you believe in the CPI and you believe that the destruction of your purchasing power is clipping along at 2 and a half or 2.6%. Then current interest rates seem very
adequate. You know the 10 years yielding 4.4 uh you're getting over 100 basis points in real yield if you happen to believe in real yield if you happen to believe in the CPI. My problem is I don't uh I
believe that the CPI is better characterized by Mike Maloney as the CP characterized by Mike Maloney as the CP lie. Uh I believe that the deterioration lie. Uh I believe that the deterioration in the purchasing power of the US dollar
marked by the basket of goods and services that I consume uh suggests that the destruction of my purchasing power is proceeding along at an eight or nine or 10% clip. That presents a very different picture.
If you're making 4.4 in a currency that's losing value at say 9, you aren't that's losing value at say 9, you aren't making 4.4, you're losing 4.5. making 4.4, you're losing 4.5. It is when that realization becomes more
widespread that gold really performs. Uh gold is viewed by many people right now after a 50-year hiatus uh as an investment class or a speculative class. I would argue that a thousand years of human history
teaches us that gold is a liquidity class or an insurance class and right now people don't feel the need for insurance. My suspicion is unfortunately that that feeling will change.
Well, I think you make a very clear distinction there and um it echoes what we talked about last time as well that when we say that the dollar is um set to
underperform, we're not talking about underperforming against other fiat currencies. We're talking about underperformance against hard assets and fiat currencies as a grouping underperforming against hard assets. And
typically that conversation is uh presented as oh well governments will presented as oh well governments will try to inflate away this debt but we don't need them to try. We have the inflation here. Uh and so I think the
inflation here. Uh and so I think the next kind of natural question is well gold is having a bit of a hangover here after an incredible rally last year. Uh, one thing you've talked about recently that hasn't been caught up in this macro
that hasn't been caught up in this macro narrative is uranium as another kind of narrative is uranium as another kind of vehicle for sort of expressing a view on on physical assets and the kind of value storage that that is. Break that down.
Uh, what's the conversation with uranium? Well, I need to start by saying in most commodities, the easy money has been made. The easy money occurs when a commodity goes from being hated, uh, it doesn't need to go to being
unhated. When commodity, when uranium was at $20 a pound, uh, although it took the industry $40 a pound to make it, so the price had to go up, it was a hated commodity. The move from $20 a pound to
$85 a pound means that the easy money in uranium has been made. It also means, however, I think looking forward that the sure money is in front of us. Why do I say that? Well, for several reasons. The most obvious reasons is that the
The most obvious reasons is that the world needs more power of all kinds. All kinds. Global power demands, global energy demands are set to double by 2050. And we don't have the capacity to produce that much energy. We just don't
have that much. Uh energy will be rationed by price. Uh nuclear power is rationed by price. Uh nuclear power is extraordinarily reliable base load
power. And importantly to in today's political discussion, it's base load power that doesn't generate carbon. It isn't the same as burning coal and isn't the same as burning coal and burning oil. Uranium has in five short
years gone from being a pariah to being a politically correct commodity. Uh which amuses me greatly frankly. The thing that's really changed with uranium thing that's really changed with uranium though I uh was and is the conflict in
though I uh was and is the conflict in the Gulf. It has been 50 years since the world cared about energy security. If you dial all the way back to 1973 and the Arab oil embargo, uh that form of energy insecurity
stimulated, as an example, the French to build what is now the fourth largest nuclear fleet in the world. It stimulated the Japanese to build the third largest nuclear fleet in the world. The impetus for that was energy
security. Energy security ceased to be a concern for 50 years, but is suddenly a very relevant concern. Uh, uranium is the only fuel on earth that has enough energy density that the Japanese anam as an example could, if
they had sufficient reactor capacity, store enough uranium to power the entire store enough uranium to power the entire country for 5 years in one uranium storage facility. You can't store that much oil or that much coal or that much
natural gas. You can't build that big a battery. The only material that can give battery. The only material that can give uh energy short nations, Korea, Japan, uh energy short nations, Korea, Japan, China for that matter, uh Taiwan,
Singapore, uh energy security is nuclear, the only one. And the big thinkers of the world uh are beginning to come to understand that. And I think
ordinary citizens are beginning to understand it too. Uh that's very understand it too. Uh that's very important. We are right now important. We are right now producing less uranium than we consume.
Uh and two things are impacting demand. One is that the Japanese are now speeding up in earnest the restart of the plants that were closed as a consequence of Fukushima. This isn't demand that's going to occur 10 years
occur 10 months from now. regards to pricing. Um Um it also uh is part of a broader trend to
nuclear plant construction. Even nations that force swore nuclear uh in particular Germany and the United States uh are dis are learning that if they are
to fund their existing economies never mind data centers that they need reliable inexpensive base load power and their voters would prefer that power to be non-carbon generating. I would suggest that the biggest unsung
beneficiary if there is ever beneficiaries of a war uh would be uranium with regards to the Gulf conflict. People think of oil, they think of gas, they think of nitrogen, nitrogenous fertilizer, sulfur, helium
uh all things that move through the straits of Hormuz. They don't think about the geopolitical uh attractiveness of a form of energy uh attractiveness of a form of energy that gives a country uh energy security.
And there is no other form of energy that gives a country energy security. >> I think that's a really important insight here. It's it's sort of the next insight here. It's it's sort of the next step in the conversation where you say,
okay, well, today it's a story about a bottleneck. But a year from now, two years from now, three years from now, there will be some kind of resolution of this bottleneck this way or that. But countries will have learned that they
live in a different world. Now I think you made the point last time we spoke you made the point last time we spoke that the 40 years uh that were there sort of through the vulkar disinflation almost right up to co is a very
different period than what we're entering now uh and uh certainly entering now uh and uh certainly delization and inflation and uh thinking about uh kind of the disillusion of US enforced norms would suggest that
countries need to start thinking about things like energy security uh in these things like energy security uh in these kinds of terms in expressing a view on uranium uh because I think I mean obviously with gold it's easy there's
any number of ways you can gain exposure from physical to ETFs to futures same from physical to ETFs to futures same thing for silver uh what's the vehicle for exposure to uranium in your mind >> there are several uh I I think for most
people the lowest risk uh exposure to uranium is to buy something called the SPAT physical uranium trust. Note here conflicts of interest. I'm the larger shareholder uh of the manager. I'm not an officer. I'm not a director. I'm not
beneficiary. >> The SPAT physical uh uranium trust is a deposit receipt representing physical ownership uh of uranium at four
facilities worldwide. Uh one is well advised not to try to buy and store at home for fairly obvious and store at home for fairly obvious reasons. Uh so the the best form of
physical ownership is in fact certificated ownership and by far the most liquid uh of those vehicles is the SPAT physical trust. If someone wants to take a bit of operational risk, I would suggest that the highest quality uranium
suggest that the highest quality uranium producer in the world is the Canadian doiciled Kamico, symbol CCJ on the New York Stock Exchange, uh, and the Toronto Stock Exchange for your Canadian listeners.
highly liquid um really a full cycle uranium shop all the way from producing uranium to enriching uranium to by now in his engineering group building uranium mines and processing facilities for other others
and generating power. The third that people might want to look at is Kazatam which is the largest uranium producer in the world formerly a large position of mine. I've sold my stock because of middle management defections. Uh middle
middle management defections. Uh middle management defections that I couldn't I didn't understand and I have a hard and fast rule. If there's a risk I don't understand, I sell the stock. There are also a range of uranium speculations,
but I'd prefer not to talk to your viewers about those. Uh they require a lot of work to be a responsible holder. And I found with 50 years of experience
aren't prepared to do the work to prepare themselves to own the name. So ones aside. I think >> and that is perfect. Uh how do you feel about an ETF like URA and sort of ETF type exposure?
>> For a lot of people it's probably appropriate. Uh I'm old school. uh the idea that somebody including my former employer Spratu constructs an index constructs an index that has probably 50% uh of the stocks in it being stocks
I wouldn't otherwise own. >> The idea that I have to pay somebody a normally wouldn't own for free is problematic to me. I realize that most kids or grandkids. They like to garden. They like to read. They like to do
things with their life other than study uranium juniors. And for them, the ETF uranium juniors. And for them, the ETF is probably appropriate, if inelegant. have, of course, a thousand more questions for you, but we're just going
to have to have you back to get to those. Uh, tell the good folks where they can get more from you. >> I'll give them incentive. Uh, anybody natural resources and wants to personalize it, including, by the way,
uranium juniors can go to my website ruleinvestmentmedia.com. There, if you list the natural resource stocks that you own, I will personally review that portfolio and rank it 1 to 10, one being best, 10 being worst, and
I'll comment on individual issues if I think my comments have any value. Please, as a sidebar, I know yours is a trading community, no crypto, no tech stocks, [laughter] natural resource stocks only. The other
thing I would suggest to your audience is if you care about natural resources, uh a conference which I personally believe is the finest natural resource conference on the planet takes place July 6 through 10. Not surprisingly,
it's called the Rule Natural Resources Investment Symposium. If you go to rule symposium.com, you can learn more. The physical conference is sold out, but you can, if you wish, attend the conference from the comfort and convenience of your
from the comfort and convenience of your own home via live stream. rules.com. own home via live stream. rules.com. By the way, ours is the only conference I know of, live or otherwise, that has an unconditional money back guarantee.
If you attend the conference and think for any reason whatsoever, you being the sole judge that we didn't deliver fully value for your money, email me. I'll give you your money back. Uh nobody else I know uh in investor education uh
maintains uh ironclad money back guarantee. We've done it for 30 years now. I'm delighted to say we've had to refund about onetenth of 1% of the years. But that guarantee is your guarantee that we're confident our
content at rules.com can make you money. And there you have it. Uh folks, uh if that doesn't explain why Rick is here explaining things to us, well, go check that stuff out and you'll find out, too.
Thank you, Rick. >> Always a pleasure, Elia. Thank you. and ask the question, is there any unusual activity that's worth discussing
and maybe even trading around? Today's names are two trades, both hitting close to the close yesterday, but with very different messages. The first one is Tesla, ticker TSLA, which is tied directly to the SpaceX IPO set to open
around 175 perhaps here. That has not yet started trading at the time of this recording. The second ticker is Meta, which may be the AI name that the market has not yet fully repriced. But let's start with Tesla here. Currently trading
around $394 a share. Someone bought the Tesla June 18th 432 and a half call. Six days to expiration. Tesla was trading around 399 when the trade hit. The strike was about 8% out of the money. Premium was $3.31 million and the volume
Premium was $3.31 million and the volume was 14,263 contracts. The open interest jumped by 5,389 contracts in a single session. That's a 202% increase. So, this is not a quiet repositioning. It's not someone taking a
little dip of a toe into the water. This is a big call sweep done into the close one day ahead of the SpaceX IPO. And that timing tells you a lot about the traders intentions here. SpaceX is being listed today under the ticker SPCX. The
IPO price is $135 a share. Reporting ahead of time says it may trade closer to 171 175 around the open, which would be roughly 27 to 30% above that IPO price. And in doing so, the company would be raising well that $75 billion
that it was seeking, making it the largest IPO ever. The demand behind the scenes is reportedly $350 billion. The book is about four and a half times overs subscribed. No wonder we're looking at a potential pop at the IPO at
the open. So, it's not just another trade here, right? Tesla is coming in the context of this Musk halo effect. Tesla owns SpaceX exposure through its AI conversion, the XAI conversion with the FTC approved on March 11th. So if
SpaceX rips on the debut, the Mus halo effect can spill directly over into these Tesla shares. That is your bullcase here. SpaceX opens strong. The retail demand is enormous against a tiny float, roughly 3 to 4% of the shares,
and traders start treating Tesla as part of the broader Elon Musk ecosystem. Once more, the call buyer is making a bet here that a sus a successful SpaceX debutless Tesla quickly. It's going to happen within the 6-day expiration
window. There's no time for a slowmoving story. This is a bet that things will out well very very quickly. There is a little bit more of a piece here. The institutional side JP Morgan just upgraded its Tesla coverage from
underweight to neutral and raised its target from 145 to 4 from 445 to 475, excuse me. But that's a massive reset from a major bank right before the SpaceX IPO. And the target is now sitting above the call strike in this uh
sweep here. So the tape is giving us the trade. We have a catalyst right now and we have a sellside upgrade all at once. Now the risk here is obvious perhaps for those that were following the SpaceX IPO road show. There were some detractors
that popped up along the way. Morning Star, which is seen as a fairly neutral uh rating agency said that the fair value for SpaceX is closer to $63 per value for SpaceX is closer to $63 per share. So if it comes in at 7171,
there's a massive gap between enthusiasm perhaps fundamental value. But it's an out that SpaceX could sort of unsustainable levels after the debut, which may be a pretty honest description. The float being only 3 to
4% matters a lot here. The founder lock up being 366 days matters a lot here. The index rules, particularly for the NASDAQ, could start to force passive buying within the next 15 days. This structure might make for a massive first
day move and it can create a market where price gets distorted fairly quickly especially through second order effects like Tesla as a proxy bet on SpaceX itself. So while the SpaceX play here through a Tesla call sweep is
fairly clean, it is the halo effect trade. If the IPO opens up strong, if Musk market goes full Musk again, then Tesla's going to catch a fast bet. If Tesla, the halo effect could just become competition. But right now, all signs
maybe there's some signal within this particular trade. There is another trade There were two Meta call trades that went across our screen here. The first August 21st, 6:30 call, 70 days to expiration. The stock trading around 560
at a time. The strike is 11% out of the money. The premium is about 4.09 million spread across 266 contracts. And then you have the July 31st 640 calls that hit the tape here. The strikes about 13% out of the money.
The premium 1.14 million spent across 854 contracts. The open interest on that line was zero before this trade. And now everything that you see here is entirely new positioning. So the combined bet is about 5.23 million in bullish Metac
calls. And unlike Tesla, there's no real IPO halo trade effect going on here. This is a simple the market has misunderstood Meta's business model and is undervalued. This is a rerating trade which may be a little bit less
speculative as it were. Meta trading around 568 is about 29% below its all-time highs established near five 796. Uh meanwhile the business is still printing the enormous numbers that you would think would be accretive to higher
share prices. Q revenue is 55.5 billion 20% higher year-over-year that beat by roughly $900 million. Operating margin roughly $900 million. Operating margin is 41%. Cash levels 81 billion. The AI
numbers are starting to perk up too. Meta has 1 billion monthly active users. Llama has 1.2 billion downloads right now. Even Threads, which I'm not a Threads user, it sells 450 million active users on a single monthly basis,
which has actually surpassed X. That was surprising for me to learn. RayBan Meta sold 7 million pairs in 2025, up from the 2 million total and 23 and 24 combined. WhatsApp business messaging is now up 74%. So right now we have an
infrastructure companies, the ones that are selling the shovels that are being rewarded. Those that are buying the shovels, the service layer on top of it costing a lot of money to actually build the buildout. But consider it right now.
distribution networks in the entire world. And the market does not talk about it as it does in the same way as an Nvidia, Marll, or even a Google because it's not a hardware company just yet. Meta is an AI company that no one
And yeah, they deserve to be dunked on after the metaverse and all, but this is They're seeing the future where we start moving away from the bottleneck and we applications. This is a company with over $200 billion in revenue, 41%
operating margins, more than 1 billion AI users, and the stock is still 29% seeing here in Meta is a bet that we're not going to get back to those highs, but we can make a significant leap towards there over this next say well
70-day window, 49 to 71 day window here. And that's where the signal versus noise trade today gets interesting. The Tesla side of this of uh uh prospect of trades here, these are event driven trades. These are binary event risk trades. They
are hoping for SpaceX to come in with a bang. That the largest IPO in history lights up the board and the Muscalo effect continues to work its magic. But the meta signal is that there's going to be a shift in the theme around AI that
the market is going to get past this recent bottleneck phase around memory chips and we'll call it uh hardware with Dell and Hulip Packard performing fairly strong in recent sessions. We we we see there's a little bit of a
divergence right now in the expression here. But both may be true. I'm curious how the chat is handling the SpaceX IPO. Our very own Tim Knight tried getting in for a,000 shares was only allocated, I believe, 24. Were you successful in
getting on in SpaceX? Let us know below. This has been another episode of Signal Versus Noise. You've been watching Tasty Live. Like and subscribe for more Live. Like and subscribe for more videos.
where we take a look at unusual activity on the options tape and ask the question, is there something real going on here or people just speculating? You know, Jamal, today's episode, we're going to go with a little bit of a twist
on that framing. Sometimes when someone says you should sell your kidneys before you sell your Bitcoin and then they go and sell the Bitcoin before they sell the kind of conviction that's remaining in the market. And that's bringing us to
Micro Strategy and Michael Sailor today because Michael Sailor, the man who said sell your kidneys, he's still walking around with two of them as it were. At least that's as far as I know here on this Thursday, June 4th. Um, before
people start throwing tomatoes at the screen for my tacky jokes, let's consider how much they've sold here. 32. Oh, no. That's right. 32, not 32,000. They only sold 32 Bitcoin, roughly $2.5 million worth between May 26 and May
31st. So, okay, the size doesn't matter here. This is a bit of a narrative getting hammered this week. What's going on here? Look, it this is really kind of more about what's going on with Bitcoin and what
this never say die product that you just held on to for life, right? And now it's become more like a treasury asset, it would seem. And and the real big story here, Chris, is what did they sell for,
right? And in this case, they sold to satisfy some obligations. Um, so I think that's the real thing about it. It's not the size, it's what did they sell for? continue to see in the future. And so as a result, obviously the stock has taken
a huge hit. I mean, it's taken a huge hit over the last year and change anyway, but it's even taken more of a hit more recently as a result of this news. And we've seen some options activity. Um, we've seen I I [snorts]
think of of all of them, the most interesting is further out, but there's some options activity that went down in the June 18th expiration. They bought the June 18th expiration. They bought the uh 131 puts. And again, honestly,
on many of these trades, but nevertheless, uh, they bought some options in in the June 19th expiration. They bought some nearer-term options in the June 12th expiration, bought the 128 put. So, both of those are around
strike. But then, Chris, the big trade that happened was further out in October expiration on the 50 strike. The 50 strike. I mean, you can see the stock is trading $131 right now. They bought on the 50 strike and that I think is the
one that makes that stands out the most. But nevertheless, I mean, this is just more of a story of once upon a time there was no chance you would expect Micro Sailor and Micro Strategy to be selling Bitcoin and now they're selling
to satisfy some obligations. And that I think makes people just a little bit >> Strategy discloses that it sells its 32 Bitcoin at a price of roughly $77,000. perspective here. That's absolutely microscopic. Micro Strategy owns roughly
microscopic. Micro Strategy owns roughly 843,000 Bitcoin. So selling a handful of 843,000 Bitcoin. So selling a handful of them, 32 32 is about double 38% 00038% of their whole total holdings. That's again not anything but there's a
change in behavior. Sailor's been the flag bearer for Bitcoin accumulation over how many years now? uh he changed his verbiage recently where he called Micro Strategy a net accumulator moving forward. For every one bitcoin that they
sell, they're going to try to purchase nine or 10. But that's a very different type of mindset and level of conviction than uh never sell or sell kidneys before you sell. And the market's starting to take notice of that right
now. It's just a more bad news and what's been a pretty long crypto window here. But I think perhaps the change that we most care about as Tasty back into the space. There's been a rapid expansion of volatility which is
pushing around these option prices in recent sessions. Well, you know, there was sort of this romantic idea in a way, right? It's almost like what we experienced for the last what seemingly hundred years with
with uh with Warren Buffett. I mean, this idea that you're buying something I think as much as people had loved and made fun of Micro Sailor, they to buy something and hold on forever no matter what. And now I I think it almost
seems more like that Micro Strategy is becoming more like a managed Bitcoin fund if anything. And maybe this is going to be something albeit not all the time that we see every so often that they sell forward various different
work from time to time. And you're right, Micro Strategy is effectively a leveraged Bitcoin company. They've spent about $64 billion accumulating Bitcoin that's worth roughly $53 billion marktomarket. So that's an 11 billion
about the preferred dividends, the financial obligations, and the capital market dependence to keep the whole game going, you're really starting to stand on stilts here. So the liabilities once they're factored into this equation, the
never sell uh mantra that Michael Sailor has held, it runs into the gravity of the cash flow obligations that they have to uh the outside world. So Jamal, I'm Is this signal? Is this noise? Is Micro Strategy a time of well a sign of the
times? Is this the end of it all for Bitcoin as we dip below 65K? Let us know in the comments below. Thanks for watching Tasty Live. Like and subscribe watching Tasty Live. Like and subscribe for more videos.
Tasty Live and we're coming at you with another episode of Options in Action. If you've missed this series, it's basically a new series where I take an old whiteboard concept or maybe a strategy that I talked about previously
and bring it into an advanced light. We take a look at the platform and we talk through the practical application of some of these concepts. Uh we're going to go through the entire YouTube playlist uh the old whiteboard series.
So we have talked about call options, put options, we've talked about premium, we've talked about strike prices and expirations, you name it. Uh and today we're talking about the age-old question. Can you make more money
trading short premium or can you make more money trading long premium? And what are the gimmies and gotchas as Dr. Jim says? Uh what are the tradeoffs with
We're going to take a look today and we'll break it down on this edition of Options in Action. So, we got this S&P chart pulled up here and this is not the
chart pulled up here and this is not the S&P stock or index chart. It is actually S&P stock or index chart. It is actually a chart of a long call out in December, the 8,300 strike to be specific. You can see here S&P uh at the top is trading at
7,300. So, we're looking at this call option a,000 points out of the money to the upside and this is the December cycle. So before we dive into this and cycle. So before we dive into this and before I I start spewing nonsense, uh I
you're selling premium, there's a difference between selling premium in difference between selling premium in the S&P 500 products like S&P or MEES or XSP or SPY. Uh there's a big difference between selling premium in those sorts
of products versus selling premium in the equity space, right? S&P 500 or other indices even products like SMH uh that have moved quite aggressively with
the tech sector popping off and selling off uh at the same time. There's things to consider, right? Short premium in the S&P 500. I I've said this before. I think if you can trade successively short premium on both sides of a market
in an equity, you can definitely do that in the S&P 500 simply because the S&P 500 moves less. It doesn't have the same binary events. It doesn't have the same
binary nature of equities. You could have a CEO step down and the stock price be down 20% pre-market or after the market closes. Or the opposite can something that the market likes and that stock is up or down 20% when the options
market is closed. It's not necessarily going to happen in the S&P 500. There's also uh market stops. Even if there is a big crash in the S&P, there's certain levels where the market stops trading. uh that doesn't necessarily help you in
the case of not taking on risk when it comes to short premium. Uh if we're talking like short puts, for example, into a market move like this or even into a market move like this or even strangles. Um but what I will say is
over the years I've learned that there's a time and place for all strategies, right? Uh I have long premium strategies where I'm buying options. It's a lower probability trade if you're holding trades to expiration. But I like to say
if you're buying options, you get what you pay for. I don't really buy options that are near-term. I don't buy zero day options. I don't buy 7-day options. In my mind, you're buying a lot of implied volatility in those cases. And it
becomes just that much harder to be profitable on those strategies because profitable on those strategies because you have this super decaying uh asset directionally, it's basically going to become worthless and it becomes that
much harder for it to reverse and work in your favor. If you're buying a LEAP option though, totally different story. Uh LEAP options cost a lot of money. you get what you pay for when it comes to long premium, but I think when you're
buying premium, it doesn't necessarily have to be a naked option. It can be. I actually have a position on in Nike right now. Uh I bought a LEAP option out at the 60 strike all the way out almost 600 days away, January of 2028. So, this
was a situation where, you know, Nike drops to multi- multi multi-year lows. We're talking decade lows. Uh this Nike hasn't been 45 at least around this
price point since uh 2015 if I'm not mistaken. So the further a price falls, especially in a product like Nike where I think we'll still see some upside potential there, um yes, I could sell a put to uh collect that premium, but at
the same time, Nike's already fallen uh and it's still down at 40. If I sell a put 16 days away for a 100 bucks, sure, I could sell that. It's a higher probability trade, you can see my probability of profit is nice and high
probability of profit is nice and high at 66%. Uh, but I take on the undefined announce something, the stock's not down another 10 points and now all of a sudden I have a $900 loss on my hands and not much management in terms of what
I can do. Uh, it also takes a decent amount of buying power, 800 bucks amount of buying power, 800 bucks relative to a $40 stock. So, for me, instead of selling a put, uh, especially when a product like Nike or any other
when a product like Nike or any other equity gets to multi-year lows or decade lows, I'd rather just inventory some long-term premium. And you can see here the further out in time you go because you're avoiding the implied volatility
announcement, something I mentioned earlier, you've got plenty of implied volatility here in the near-term cycles that isn't necessarily reflective of these long-term cycles. Right? Look at this expected move for June 30th. You
have a plus - $4.60 implied move with a 60% IV almost. But you look at January of 2028 and it's only a 17 point implied move. And that's because the implied
volatility is significantly lower when you get all the way out here on the curve. So will I be trading Nike? Will I be selling premium in Nike around the earnings announcement in a defined risk way? Absolutely. Uh like I said, there's
a time and place for everything. I think for Nike with the upcoming earnings, I'll probably sell something in this 22-day cycle, but I'm going to buy something in July or August. I likely will go to something like a diagonal
spread or calendar spread uh in that sense because I still want to trade intelligently. I still want to reduce cost basis which has always been uh something that we've said here on Tasty Live. I want to make sure that I am
reducing my cost basis and improving my probability of success anywhere I can. So in this case, if Nike is offering super high premium to sell something against even a long option I'm buying, whether it be a calendar spread or
diagonal spread. Uh we can look at this here like the 45 strike in July trading here like the 45 strike in July trading for $2.50. We'll call it the 45 strike in July 2nd. Look at that. You have two weeks of a difference in time but only a
40cent difference in the option prices. I'm absolutely going to be selling something against that long option that I buy if I'm bullish. And same thing if I'm bearish. But longer term, Nike's down to 10-year lows. So what does that
mean? It means I'm going to get really far out on the curve here and risk $500. This option hasn't really moved all that much, which is interesting. Nike is still chopped around, and this 2-year leap basically is trading for 500 bucks.
My whole thesis is, would I be surprised to see Nike go from 45 back up to 50 or 55 or 60? It was just there a couple months ago. So, my answer is no. I would not be surprised. And if I'm buying a LEAP option that has much lower implied
volatility, I know, yes, it's a little bit more costly, but I'm out of the IV spike in the near term. I'm inventorying long-term delta inventorying premium that isn't going to decay against me all that much. And if we get a move in Nike
that much. And if we get a move in Nike from 45 to 50 or 55 or 60, that option from 45 to 50 or 55 or 60, that option is going to uh be worth $1,000, $1,500. And we can see this here. If I right click on the option in the chart, the 60
strike, if you right click on the bid or ask, you can have this menu pop up here. View the option in the chart. And here we go. It's been trading for $500 basically ever since I bought it. But back here, when Nike was at 55 and60,
this option was trading for $1,500. So, from a riskreward standpoint, as a product like Nike or any other equity gets to decade lows or multi-year lows, I'm going to be inclined to lean into the long-term positioning. I did the
same thing in Microsoft, right? Microsoft went from 550 down to sub 400 levels. What did I do? I was buying into some near-term stuff. We we set up some also did a really long-term calendar spread at the 500 strike. I bought
January of 2027 and sold September of this year. And that was like a $500 know what's going to happen in the near term, but I do feel like over the course of the year, Microsoft's going to be higher than where it is now. And that
ended up being the case. We saw a nice bid, got all the way up to uh 460, and you can see uh I've had some decent trades up until that point. And the only
trade I have left is that calendar spread in Microsoft and it's up a couple hundred dollar uh right now. Uh if we look at the 500 strike, I bought it for 500 bucks. It's up $400 right now. So I still want to have it on. I think
there's uh a bullish case for it. But to answer the question, selling premium versus long premium, uh I think when you're selling premium, you have to be able to withstand all variance within that product you're selling, right?
Because from my perspective, the most success that I've had in products where I've sold premium, uh, it's been in products where I've traded small enough or the product size was small enough to where I could manipulate the strikes,
manipulate my time and expiration or a combination of both. Right? That's the beauty of undefined risk. You have the flexibility to be like, you know what, this expiration. I'm going to buy this back and I'm going to move it out a
month. I'm going to move it out two months and move my strike and collect a credit still. So, that is how I approach undefined risk these days. It's going to be a much higher probability of success naturally because when you're selling
premium versus buying premium, if you sell an option, you just need the stock price to stay out of the money or in this case above your 37 1/2 put. If directional move in the stock price. And that's as simple as that. So, when you
think about that, if I'm selling premium and I just need my strike to be out of the money, I'm going to be much more inclined to sell near-term premium is higher. There's not enough time or there's not as much time for the product
to move against me in a big way. It can still happen, of course, but that 30 to 60 day window is where the implied volatility is nice and high relative to a nice blend of time value as well. So, that's why we are selling premium in
that window. We have research that shows that that's kind of the sweet spot of implied volatility value plus time value. So selling premium in that 30 to 60 day window. Buying premium, I prefer to be outside of that 60-day window.
Honestly, I would rather buy premium in a 90-day, 100 day option cycle if it if it's something I can afford. In the case of Nike, I can do that in a 25k, 30k account. Of course, um even smaller, you have the ability to do it because the
stock price is so low. But in something like SPX, $7,300 stock price, I don't have the ability to sell premium in here. Uh I can trade spreads in here. I can do uh calendar spreads, some diagonal spreads in here, but sometimes
the stock price is the determining factor of your strategy. So keep all this in mind and just really make sure if you're selling premium, you you need to be able to withstand the variance of any kind of move. I prefer to if I'm
selling a put or a strangle, uh let's talk about puts. If I'm selling a put, I I can just hold that premium or take the shares. I would rather not exit at, you know, two or three times the loss of
that short put because if I'm selling an undefining risk put, I kind of want to have that bullish delta anyways if it does get down there. I don't want to be stopping myself out and then two weeks later see that it could have moved out
of the money. So, that's just me. Um, but to summarize, if you're buying options, you get what you pay for. I think, uh, in this kind of market environment, I'm always going to have something against it. Like, if I'm
buying a 60-day option, I want to be selling something in the 30-day cycle or there's an earnings announcement where that premium is really juicy and I can reduce the cost basis on my long option because the more you can reduce the cost
basis on your long option, the more flexibility you have going forward to have that long option be profitable or even a scratch. If I'm selling premium, I'm very cognizant of the fact that it is a higher probability trade. You're
going to have a lot of winners when you're selling premium, but you should also understand how to manipulate that trade. With defined risk debit trades, when you're buying premium, there's not a lot of things you can do. There are
spreads uh and diagonal spreads where you can manipulate that short option by moving the strike or moving it out in time. Uh but with short premium, specifically, you can do a lot of different things. you you have a ton of
flexibility uh in the ability to manipulate strikes. And if you look at my order chains for the MEES position, this is my year-long strategy for 2026. I've clearly manipulated this position over and over and over. And every single
time I do it, I collect more credit. I started with 93 points in credit. I now started with 93 points in credit. I now have 700 points in credit uh overall which means my break evens are 700 points beyond my strikes and this is a
selling premium to offset any kind of intrinsic value uh losses that might show against me. So short premium I like to reserve it for either products that I
to reserve it for either products that I can afford any variance in or something in like an index like MEES is a great example or IBIT even the Bitcoin ETF that was my year-long trade from last year. Um, so I think when you
you in a a good spot to be able to withstand variance. And again, if you have a day like today and you're like, "My account is really suffering." Then I think your trade size might be off. I
think maybe the strategic decisions might be a little bit off. Again, we variance as possible. With undefined risk, I think it's got to be any enough to where you can withstand any variance. It just sets you up for
success in the future and it gives you that flexibility to manipulate the trade as the markets move. And with defined risk, same story. Uh I like to keep them within $500 to $1,000. I think that's a healthy level for me. But again, if I'm
spread, I have a plan for if things go wrong. I know I can move that short strike out in time. I know I can move that short strike up or down depending on the strategy. But uh yeah, let me know what you think in the comments
below. That was a long- winded segment. Wasn't expecting to go that long, but uh hopefully that kind of mental shift helps a little bit. Again, if I'm selling on finders premium, it's usually in an index product or a micro futures
product and it's sectorbased. It's not something that's going to move 20% pre involving myself in those types of products, it's going to be in a product withstand any variance. I can manipulate the strikes up and down. And I think
that's another interesting uh and important point is undefined trading, super high probability if you're doing out of the money uh sales of options. But understand what you can do to manipulate that risk profile and that's
just going to give you another leg up in the future of trading uh as the markets you're going to have your winners, you're going to have your losers, but adjust those losers if they are undefined risk trades. But thanks for
tuning in. Let me know what you think in the comments below. Please like this channel, and we'll see you on the next episode of Options in Action.
Live with another episode of Options in Action. If you've missed the previous episodes, this is a series where I'm talking about old whiteboard videos where we're looking at concepts and strategies, but we're giving it more of
an advanced twang and we're looking at the platform itself, talking about certain concepts that I'm using today and how it applies to everyday trading. We talked about expirations last time and today I wanted to talk about letting
an option expire in the money and ultimately taking shares of stock. Al ultimately taking shares of stock. Al also we can talk about expiration risk something that I'm worried about at all.
I think we can wrap those up into one and kind of just give you a nice uh package of ways to think about expiration and why not to be afraid of assignment risk, especially if you have defined risk spreads or an in the money
short put or in the money short call, something like that. So, let's dive into the Taste Trade platform and we'll break it down for you. So, we're looking at SPY right now. As you can see, SPY has had a massive rally from the lows of
this year. In April, we were all the way down at 635ish. Now, we're sitting at down at 635ish. Now, we're sitting at 755. Just an insane run to the upside. And maybe that has resulted in in the money options. So, for those that don't
know yet, uh if you have an in the money option, it's ultimately going to expire option, it's ultimately going to expire and turn into shares of stock. So if I have a 760 put for example that is in the money, I will ultimately be assigned
100 shares of spy at 760. Same thing with the opposite side. If I have an in the money call, a short option that's in the money and it is assigned or expires in the money, I will be uh basically have 100 short shares of stock at 750.
Now, a lot of times we're not really dealing with assignment risk because we're rolling our options positions out in time. And really, assignment risk is highest when you don't have a lot of exttrinsic value in your options strike.
So, even even with a 750 call that's in the money, 15 days to go, there's still $600 of exttrinsic value that uh somebody would be giving up to exercise this option and turn it into shares of stock. In other words, they're taking
$600 and lighting it on fire. That's why I don't really worry about assignment too often. I've been trading for over 10 years and I've been assigned maybe three times, four times maybe. Uh, in one of them was a celebration. In this case, it
was literally like I had an in the money option that was that had $200 or so of exttrinsic value and I woke up the next day, I was assigned on it. I got the shares and kept that money, the exttrinsic value. I closed the shares
basically doubled my credit overnight. So that's another thing. If you are exttrinsic value associated with your option still, it can actually be a benefit to your position. Uh the only
situation where that would not be the case is if you had a dividend that you had to pay. So like with an in the money call at 7:30 for example, let's say spy call at 7:30 for example, let's say spy had a dividend of $400. there's $288 of
exttrinsic value here. The counterparty would give up their $280 of exttrinsic would give up their $280 of exttrinsic value to get the $400 dividend. So in that case, it's a net positive for that counterparty. And that is the
circumstance where you can get assigned early. Your options can be converted to stock early uh if there's a dividend where the dividend exceeds the exttrinsic value left in the option. But other than that, like you can look at
these options here. Like this is a 715 720 option. It's 35 points in the money and it still has $200 of exttrinsic value. This is still an option that has a low assignment risk here. So not really worried about options that turn
into shares of stock. What I do want to bring up is how it can actually change your risk profile for the better in a lot of cases. So yes, if you have a spread, so like let's say you've got a uh 755 750 put spread, right? You're
kind of teetering on this short option here. This is a defined risk trade. here. This is a defined risk trade. However, if SPY drops significantly and over time someone exercises this short put, you're still left with a long put
here that protects your risk, right? Because a short put converts into a 100 shares of stock. A long put represents a 100 short shares of stock beyond the strike to the downside. So even if I have a short put spread and I'm assigned
a 100 shares of stock and spy, if I can hold that buying power, that's the big that would certainly be increased relative to this $300 uh buying power here for this narrow spread. It actually increases my max profit substantially,
that's because the most I can make from this spread is just the credit I received on entry. However, if SPY drops like a rock and I'm assigned on this short put and I still have this long
put, as long as I have the long put, my risk profile doesn't change on that package. But I would now have a 100 shares of SPY with a static delta of 100, which means if the market drop dramatically and I get assigned on the
short put, I still have the protective long here. If the market rebounds and now all of a sudden we're back at 755 and beyond, I'm making money on those 100 shares of stock where I wouldn't have been making that money on the
shares because with just this options trade, I can only make the credit received. So, another situation where that makes a lot of sense is just like take the shares uh and just use the shares as a static delta lever is in
products that are smaller priced and maybe you've sold a put and you're trying to uh you know roll the put forward. Under Armour stands out to me because I already have 100 shares of Under Armour for this exact reason. But
let's say you sold a put uh in these options expirations. There's not too many here, but let's just say you you sold the 7 and 1 half put and or like the 10 put. You can see there's very little extrinsic value here. The deltas
little extrinsic value here. The deltas are super high. And if you were assigned 100 shares of stock in Under Armour, yes, you can only make the amount of the put if you sell this put. And I think that's the big the big key here. If
you're assigned 100 shares, you now have unlimited upside potential on how much you can make if the market does recover to the upside. So the deeper in the money a short put goes, the closer it gets to a 100 delta, the less exttrinsic
value you're going to have. So, if you're thinking of rolling a deep in the money put and you're trying to roll it, let's say from July to uh August or picking up a lot of credit, but you have a really high delta on your short put,
it actually might make sense to consider taking the shares of stock where you no longer have a option that you can only make as much as the option is worth. You would have 100 shares of stock where you can make a lot more to the upside. So,
options that expire in the money. I mean, again, I don't really hold things mean, again, I don't really hold things to expiration to uh risk that. That is about, though. Like, if you have a a spread that's teetering in the money and
out of the money, if you let the spread expire and you're assigned on the short put and your long put goes away, now you don't have the same risk profile. You still have the 100 shares that you're assigned on the 755, but you would no
longer have the protective put down here. So, something to consider. But uh deep in the money options that have no exttrinsic value, if you take the shares instead, you have a higher max profit going forward and you have the same risk
money short put or deep in the money short call. Uh but you now have the short call. Uh but you now have the static delta in the shares where a short option that's deep in the money if it starts to rise uh towards the at the
money price, you can only make the amount of the option itself. So again, deep in the money options close to 100 delta with no exttrinsic value. In almost all cases, your max profit is higher if you just convert the shares if
have to manipulate the strategy and change the risk on it uh by rolling out in time and moving it if you can. But those options that are super far in the money are trading like stock basically anyways. So let me know what you think
in the comments below. Uh, please like this video, subscribe to the Taste of But yeah, let me know if you've ever been affected by uh a short option that exttrinsic left. Not a dividend stock, but like maybe someone made a mistake.
They converted to shares. You get to keep that premium. You sold out of it again. Uh, it's only happened to me once in 10 years. So hopefully that kind of stuff happens to you guys more often. Uh, but let me know what you think in
the comments below and we'll see you on the next episode of Options in Action.
but the business keeps improving. Q1 revenue grew 17%. Sports book margins are expanding, and the new prediction market world is already running at a 3.1 billion annualized volume. Wall Street is overwhelmingly bullish. 29 analysts
rate the stock as a strong buy with targets as high as $52 per share. The World Cup could be the catalyst. Tournament expands from 64 to 104 matches, runs 39 days, and could generate up to 4 billion in US betting
handle. DraftKings is expected to process more than a billion of wagers alone. The stock is still trading like a company in decline. The question is, is the options market pricing the biggest betting event in history or just the 40%
pullback? Let's check it out on today's episode of Options Math Check. So, we've got the Tasty Trade platform pulled up here and the DraftKings chart, as you can see, uh, is looking a little bit better than it has recently. Um, but
when we zoom out, we can see this thing has taken a beating here. Um, but I DraftKings and I think that could be really interesting. DraftKings is one of these products where it's like when football season's going, when you listen
announcements, they're talking about the revenue from football season and all a layup for them. They're going to be making a ton of uh revenue from the someone in the office was just like, "Can I bet on DraftKings for the World
can." Uh so I think it's going to be interesting to see how the stock market reacts uh specifically with DraftKings alone. But when we dive into the options here, we can see uh and take a look at the probabilities of being in the money
on either side. And we can clearly see that there's an interesting pricing dynamic here when you look at the outofthemoney strikes relative to uh the puts and the calls. So, I always like to check out just equidistant strikes to
see in the near-term and also the long term if there's any kind of skew here. And clearly, there's a little bit of call skew. We've got a 40 40cent option five points out of the money to the downside. But we've got about a 50cent
bid on the upside, five points out of the money to the upside at 35. That's in the July cycle. Doesn't account for earnings. But if we look at August, which will have the earning cycle, and we do the same analysis, we've got a 25
strike at a dollar and the 35 strike at a$125 or$130. So the market's pricing in the velocity of risk to be to the upside with this call skew. And that's really what call skew is. It's just the options are more expensive compared to
equidistant out of the money puts. And that tells us that the market is pricing in velocity of risk to be to the upside if we're going to see a big move. Uh and if we look at the end of the year, December 2026, looking at these same
strikes, the 25 strike, five points out of the money, trading for about 250 and the 35 trading for way more, a dollar more, trading for about 325. So I think this is super interesting and super telling. uh just the fact that this
stock has been beaten up, but to the earlier point, you have increasing products, you have increasing revenues, you've got almost every state available in the US uh for betting markets and prediction markets and whatnot. So, I
think when you look at all these things and you bring in the fact that we've got the World Cup, we've got football season right around the corner, I think it's DraftKings. Now, that doesn't necessarily mean that the stock price is
going to rally or should rally or will rally, but based on the pricing alone, looked at two different options expirations. So, I would say, you know, strategies, at the very least, we can
use that call skew either in July or August or even longer term cycles, we can use the call skew to our cost basis reduction advantage by selling that call diagonal spread where you've got a short out of the money call further up
the options chain, you're collecting more than if you had a bearish strategy on and the stock's already at 29. Uh it of course could go to zero. But if I'm playing for a move to 45 or 50 or 55, at the very least we've got that call skew
to help us out in terms of cost basis reduction. But let me know what you this video and subscribe to the Chasey Live YouTube channel and we'll see you on the next episode of Options Math Check.
of America says seven of 10 bare market signposts just triggered. The same average seen at every market peak since 1990. The Buffett indicator, which measures the total value of the US stock market as a percentage of GDP, was at
market as a percentage of GDP, was at 219% as of March 2026, which is 65% above the long-term trend line. Buffett himself said that when it approaches 200%, investors are playing with fire. Hit a record of 228% previously. The
Schiller Cape is at 39.8% only higher once at the dot peak. Kramer flick flipped cautious Monday night, warning a wave of mega IPOs, including a
could drain liquidity from the rest of the market. Goldman says crowded positioning means when this unwinds, it unwinds fast. The bulls aren't dead. unwinds fast. The bulls aren't dead. Morgan Stanley sees 8% upside still, and
history says the fourth year of a bull market finishes positive. So, who's right? A lot of conflicting information here. Let's find out on this edition of Options Math Check. So, we got the S&P chart pulled up here and uh like we were
just mentioning, I mean, what goes up fast might come down fast and we're kind of seeing that play out here. The E- Minis went from 6,300 all the way up to Minis went from 6,300 all the way up to 7,600 in a matter of a month and a half.
And just over the past four days, we're seeing market moves and intraday moves that are massive here to the downside. Specifically, EMIN is down 1 and a.5% Specifically, EMIN is down 1 and a.5% today. NASDAQ down 2.8% uh kind of
mirroring that big wash out we saw on Friday. I think what's really interesting about this market uh and maybe a testament to the potential bearish case is that crude oil, the one thing we've been hanging our hat on time
and time again in terms of if we see the market down, we typically see crude oil ripping higher. Crude oil is not moving to the upside. It's actually selling off today. And you parlay that with the fact that when you look at the near-term
expirations in these uh different contracts, this is the most narrow backwardation I've seen in crude oil in quite some time. 8795 in the front, 8643 in the back. This thing got as wide as 15 points at the height of the war. So I
and crude oil down today, I don't think we can lean on that anymore in terms of selling off today. And I think the fact that crude oil is down and the market is down big uh is a testament to this being an equity move versus a reaction in uh
global tension. So I think that's really interesting. And uh when we look at S&P specifically for the end of the year here, 200 days away, we're seeing some really interesting things play out in terms of implied volatility. We've got a
$6,600 price on the 8,300 call, which is a,000 points above the current market price with a 15% probability of being in the money. You go to the downside, 1,000 points, and we've got put skew here,
plenty of put skew uh to the downside. Now, you've got an option price at 6,300 Now, you've got an option price at 6,300 that is about to eclipse $13,000 with a So, not only is the probability higher to the downside, now you've got more
almost exactly twice the amount of premium when it compares to uh put versus call premium. This wasn't the case about a month ago when the markets were rising higher. You saw uh similar pricing from the put side to the call
side. And we also have to factor in the fact that S&P prices in interest rate premium on the call side. So take that for what you will. But as of right now, we are seeing put skew getting infused into this market into the sell-off. As
you might imagine, pretty sizable sell-off. Probabilities are are higher to the downside now. And I think the most interesting thing here is this volatility curve. So when we had the big market rally, we saw volatility creep
into the teens. We saw the VIX in the low teens. Uh but now we're seeing the volatility curve flatten out here. Just a few days ago, we had a two-point contango between the M and the N contract. The M contract currently sits
at 2040. The N is at 2115. So, it's not even a point of contango. Now, we are flattening out across the curve. A couple months ago, uh maybe maybe a couple weeks ago, we had a fivepoint contango between the near-term contract
and the V contract. Now, you can see it's only a twopoint contango. So, this entire V curve is flattening out. You're seeing an 8% increase in the M contract and the VIX I think is the story here. Uh up 14% up three points up to 21 and a
half. I think if we see this continue another red day in the market down 100 points or 150 points and the NASDAQ selling off as well with crude oil selling off I think you could see this V curve completely flatten out. Maybe we
trickle into backwardation. And I've always said if the volume if the volume market goes into backquidation, that is the gate that opens for a further market sell-off. I'm talking 10, 15, 20% to the downside. Uh until that happens though,
I'm going to be uh trying my best to pick my spots here to the upside, staying defined risk. Uh but again, if this V curve completely flatten flattens out or if we go into backwardation, I think that might be uh a sign that we
could see a bigger move to the downside. Uh there's lots of warning signs out there like we mentioned earlier, but again, the V curve and volatility is uh my crystal ball in terms of my guiding light and how I position myself. Uh but
I've always been uh placing some downside hedges and S&P NDX. I actually today. So, uh make sure that you're you're bullish, you still should still have some bearish hedges on, albeit
But let me know what you think in the comments below. Please like this video, subscribe to the Tasty Live channel, and we'll see you on the next options math we'll see you on the next options math check.
best ways that you can help us by liking the video or subscribing to the channel. Either one of those guys really helps us out a lot. All right, so earning season is here and we all know what that means. Everybody wants in on the action, right?
get going. We want to trade our favorite stocks. We want to get in on the big names, use our favorite strategies, take our directional shots and what have you. But we all know that earnings, man, it can go either direction. I mean, these
events are binary in nature for a reason. There is most likely going to be a very explosive move in the stock one way or the other. And so, when it comes to earning specifically, a lot of times using a strategy that is defined risk is
Today, I want to walk through my all-time favorite defined risk strategy for earnings, the expected move butterfly. So, most of the time as and we're trading volatility, right? We're selling premium. We're playing
time passing. We've got the positive data, we've got the the the time decay, us. Okay, that's great. We're also trading volatility. We're trading volatility's natural natural tendency to contract. We're trading volatilities,
over time. And so these two things are nondirectional in nature and that's typically what we're hanging our head on as a premium seller. Okay? But every once in a while we might want to trade direction. Like every once in a while we
once in a while we might want to take a bearish shot. And around earnings, one of the metrics that can be really nice to kind have an objective view of the analysis around that stock or the market at that given time or what have you is
the expected move for that cycle. So looking looking at the expected move using the expected move for that cycle in that stock can really give you an unbiased look at what the market is pricing in for the upside or the
downside. And the really cool thing is we can use the expected move alongside the expected move butterfly to set up a really nice directional shot that's relatively cheap to play earnings and play to the upside or the downside,
however we see fit. Let's hop into Tasty Trade now and let's set one of these guys up. All right, so I'm inside of my Tasty Trade platform and I picked a real doozy of a time to do an expected move butterfly around earnings because it's
so if you go to like the Tasty Default watch list, I mean, you can look at the before the video and it's like, man, we've got Len like Len has earnings today. Never heard of them, right? We've got Adobe coming up maybe later today or
potentially trade Adobe, but you've got Kroger next week and JBL on ACN and it's like, okay, this is not exactly the season for the heavy hitters. Like, if I go into the Tasty Default watch list and I sort by earnings just by clicking on
that I mean, there aren't really any decent ones coming up that we like to trade on a regular basis until later on in July. And so, really, this isn't the best possible time to do a video like this, but we are so far into it now, we
can't turn back. So, we're going to go ahead and still use the same basic principles of trading an expected move butterfly like in the front week around a binary event and so that way you are ready come time July when there are more
earnings opportunities. Okay, so let's use Google for the purposes of this example. Now, I may not have done a good job from a calendar standpoint in terms of the best possible time to do a video like this. However, it is a Thursday. So
today is a Thursday and oftentimes using an expecting a butterfly I'm looking to set that guy up in the front week. So using that Friday's expiration and the reality is this Thursday into Friday butterflies are really really nice
because with a butterfly you want to nail the direction of move close to expiration. That's going to allow you to achieve the most profitability out of the strategy. And so by choosing an expected move butterfly on Thursday
going into Friday if you do get the move that you want, you're going to be in a amount of money in a pretty short amount of time on that following days opening you know, the previous week or even like a Monday or a Tuesday going into Friday,
it's a little bit more challenging to make significant profits on the strategy because with a butterfly, you want all the exttrinsic value to come out of the options. You want all the extrinsic value to drain out of the options. And
butterflies oftentimes cling to their exttrinsic value until the very end. And so Thursday into Friday, butterflies, Wednesday into Friday, butterflies using favorites. Monday into Friday and Tuesday and Friday, I'll still do them
opportunities to make money, but you're not likely going to make that much money. Okay. So, if we pretended that Google had earnings tonight, let's say, and I wanted to set up a butterfly to take advantage of that, then what I
might do is, let's say I want to play Google to the downside. So, a lot of my butterfly is I want to situate my strike right around where the expected move cuts off. So, this copper strip is the expected move for this cycle. So,
move obviously is only plus or minus about five bucks. And so if I bought a 345 and I sold a 340 and I went ahead and bought a 335 because the butterfly has to be a one by
two by one. So I go back into the center and a and I double that guy up and you and a and I double that guy up and you can see that is a very very cheap way to take a directional shot. Right? I'm only paying 90 or 91 cents for a $5 wide
butterfly. And so again, very cheap way. Take your directional shot. If you miss if Google rallies, then you're only going to lose what you paid. Like you're debit that you paid. And if we were to set this guy up on the call side, you're
going to see a very, very similar setup. If I buy at 345, I sell a 350, I buy at 355, I double up on the 350. Again, it's 95 cents. It's basically a symmetric market right now with the with the Google be with the the Google with
Google being right around 345. And so with us kind of starting at that 345 same pricing on both sides of the market. So whether you want to play it down or up, it's effectively going to be the same risk in both trades and the
same risk return dynamic. And generally speaking, what I want to do here is I speaking, what I want to do here is I want to size my butterfly such that it fits with my position sizing parameters. Right? Remember, with defined risk, we
want to be typically 1 to 3% of our account. Now, in this account that I'm practice account, this is about a $35,000 account. So, this is a very size. I could easily go up a few more dollars, no problem. But generally
you want to live on the lower end, you want to live on the higher end, that's generally speaking, that's going to be a pretty good range where we can where we can live. Now, the wider you make your butterfly, the easier it's going to be
to make money. That is just the truth. But of course, we've heard it before, and here it is again. For every gimme, there's got to be a gotcha. And so, if I'm going to widen out my butterfly, then I'm going to have to pay more for
that additional width. So, for example, if I just stay on the call side here, just to make this a bit simpler, let's say I move my 345 strike down to 342, say I move my 345 strike down to 342, and I move my 355 strike up to 357. Look
at what happens with uh to the debit that I pay. It's gone up to $2.32. But now I have a lot more money that I could potentially make. Now my maximum property is over $500 whereas before it was only about $400. My probability is
higher than it was previously because again the market understands and the metrics understand that this is going to be an easier trade to manage if it moves in my favor. If you have a super tight butterfly like a dollar wide or $2 wide,
Like yes, it's not going to cost you anything. Like you're literally not even going to know that it's gone if you lose it. The problem is those are very very to manage. You have to thread that needle. I have to get the perfect price
at the perfect time. And so I much prefer to widen out my butterflies to So I would probably settle on this butterfly. Whether it's to the upside or Depends on, you know, the directional bias that I might have. But this is
Give me a little bit more kind of meat on the bone when it comes to, you know, the risk return dynamics. Give it a bit more economic significance. And so when you're setting up your butterfly, your expected move butterfly, I should say,
pin the short strike, I'm sorry, pin the expected move with your short strike, butterfly relative to your position sizing parameters in your account. And again, this is a great strategy for a binary event like an earnings release.
move butterfly. Now, again, it's not technically around earnings event today, at least in terms of a stock that we all know and trade and are familiar with. And so save this in your repertoire for when earning season comes
around in just a couple of weeks. And so you will be ready to go because we want to hang our hat as premium sellers on time and volatility. But still from time to time taking a directional shot. I mean it's fun. It's fun. It's part of
little bit of money. And now you have a really really cheap way to do that move butterfly. And I'll see you guys next time.
best ways you can help us are by liking the video or subscribing to the channel. Either one of those guys really helps us out a lot. So, generally speaking here right? We want to play into the high probabilities. We want to play into the
short side of the option contract, generally speaking. But every once in a while, we also like to flip the script. Like, every once in a while, we like to like to use debit strategies and kind of play for volatility rising. And one of
the classic strategies to set up for that type of play is a calendar spread. So what I want to do uh what I want to do today is hop into the platform and let's set up a calendar spread. But before we set this guy up, let's just
spread look like? Well, it is going to be a multiple expiration cycle strategy where you're selling the front month and you're buying the back month. you're choosing the same strike in both months.
feature of the strategy between the short option in the front month and the long option in the back month. And the reason why you set the strategy up this advantage of two elements. You want to take advantage of time decay even though
it's a debit strategy. And you also want to take advantage of any potential volatility expansion. So, the time decay comes from the simple fact that that front month, it's going to burn faster than the back month. it's going to decay
more quickly than that long option that is sitting in that back month. And for the volatility aspect, the backmonth option is going to have a higher Vega than the front month option. And so by having that higher Vega in the back
month, if there is any volatility expansion in that underlying stock, you are likely going to see a pop in your P&L from that volatility expansion. This is why we typically like to do calendar spreads when volatility is on the lower
end of the range. So, all right, let's hop into Tasty Trade and let's set one of these up. All right, so here I am inside of my Tasty Trade platform and I've got Meta pulled up and this is a $600 stock. Okay, so the first thing you
want to understand is we really like to use calendar spreads on higher price stocks. So, not necessarily $600, but the price of the stock doesn't necessarily kind of preclude preclude you or prohibit you from doing a
calendar spread in that stock because the higher price of the stock really plays well with the more aggressive management style that we typically deploy with calendar spreads. We're typically managing these spreads at 10
typically managing these spreads at 10 to 20 to 25% of our debit paid. And so if you choose a really low price stock like a $50 stock or a $75 stock, it's spread, which is nice because that is indeed your maximum loss, but it's just
not going to give you a whole lot of economic significance when it comes to the profit potential on that strategy. So, okay, so I'm in Meta. The way that we would generally set up a calendar spread is going to be again, I'm selling
the front month and I'm buying the back month. Don't worry about the earnings illustration. We'll come back to that at a later date. Usually, we like to be at about a 1:2 ratio between the front
month and the back month. So, you can see we're at about that ratio right here with this meta calendar spread. So, when I go to set this guy up, I'm going to open up my July cycle first. Now, in terms of the strike selection, remember,
same strike. So, the 580 in bull cycles or the 560 in bull cycles or what have you. Usually calendar spreads, the spirit of the calendar spread is a more of a neutral strategy. So you're usually typically choosing a calendar spread
with some strike around where the stock is currently. Now you want the stock to that's where you want the stock to go. So if you want to be more directional, the low end. You can certainly choose strikes on the high end if you want to
be more bearish or more bullish. But usually the spirit of a calendar spread is more of a neutral strategy. On that note, we typically prefer put calendars relative to call calendars. It's not a huge difference, but remember this is a
volatility expansion play. This is a long volatility play. So, if volatility spread. Well, we know, or maybe you don't know, and maybe this is the first time you're hearing it, but market prices and market volatility typically
move inversely. So, when market prices are down, volatility is typically up. where the market is down huge and volatility is up pretty significantly. And so we typically observe this relationship across the board with a lot
of individual stocks as well. So if I'm playing volatility to expand, I'm playing volatility to the upside, then I want to position myself to potentially extract as much benefit from that volatility expansion as I possibly can.
So choosing the put option slightly below where the stock currently sits. Even if it is mostly neutral, choosing a 580 or 575, that's going to allow me to situate my strike such that if there is volatility expansion and the stock price
moving lower, that's going to really help me. So right here, let's say I sell a 580 strike, which is just slightly below where Meta is right now in July. And then I close up July. I go to August and I buy the same strike, the 580
strike. And so notice how this is a debit of $14 on this strategy. So this calendar spread. You would probably want to have, I would say, maybe $30,000 in
than that, or maybe even a little bit less. But this is not going to be a strategy for a tasty bite-sized account. But if I'm managing this at 10% of debit paid, that's 140 bucks. 20% of debit paid, that's 280 bucks. So, it's pretty
significant when it comes to the management. When I'm using my or when I'm selecting my strikes, I want to make sure that the exttrinsic value in the front month is over and greater than the debit that I pay in the strategy. This
gives me the best possible chance to make money from time decay because I know if nothing happens and the stock just sits here, which we know that it and ends up back here when all is said and done, then all that extrinsic value
that came off of that front month is going to cover the debit that I pay in effectively make it a little bit easier for me to make money. So this $14 and for me to make money. So this $14 and some odd cents. If we go back to July
where my front month is, you can see I'm collecting over $22 in exttrinsic value. I know that that's all extrinsic value because this option is out of the money. And so the way that this calendar spread is setting up in meta looks pretty good.
This would be a great candidate for a calendar spread. And so hopefully this kind of makes sense from the higher priced stock preference to the put uh put preference. It's mostly a neutral strategy managing aggressively at 10 to
20% or even 25% of debit paid and then making sure that front month extrinsic covers the debit. So, okay. So, that is a calendar spread. Hopefully, that makes sense and we kind of covered the major points of setting up a calendar spread.
Now, in today's market with the VIX skyrocketing and volatility rising, this may not be the best market to sell a C or put on a calendar spread in. But when volatility eventually collapses, when volatility eventually contracts, as we
know that it will, if history is any guide now, hopefully you are ready with that low volatility. And I'll see you guys next time.
today, the best ways you can help us are channel. Either one of those really helps us out a lot. Okay, so around here you guys already know the drill. Like you already know that we are premium
sellers. You already know that we want to live on the short side of the option to play volatility. We want to play probabilities. We want to do all those kinds of things. But time to time, every once in a while, we want to venture off
onto the other side of the contract and maybe buy a little premium. Well, today that's what I want to talk about. When does it make sense to maybe consider being on the long side of the option contract? Well, I can think of three
specific scenarios and I want to unpack those in detail right now. So again, by and large, we want to be on the shortest alley contract, right? We want to play premium, especially out of the money premium, you're going to have
probabilities of profit that are in excess of 50%. Could be 60, could be 70, could be 80, could be, you know, 97 for my three delta put sellers out there. I you've got to blaze your own trail. We want to trade the high probabilities of
the marketplace. Okay? We also like being out of the money because that a little bit of buffer and a little bit of wiggle room on the position when it comes to not needing to be right historically. And then lastly, we've got
the implied volatility overstating realized volatility on average over of course, but that is what we're hanging our hats on. So, when it comes contract, those are the main reasons why. But when does it make sense to be
on the long side of the contract? Well, here's the first scenario. when the VIX is super low, like you've got a VIX at 11, 12, 13, 14, you're just not really getting paid to sell premium. You're just not really getting paid to be on
that short side of the option contract. And so in these markets, when volatility is at these levels, it's now going to make a lot more sense to be on the long prices are cheaper. So whether you're buying the options outright, again,
something else I don't know that I would necessarily suggest, or even buying your cheaper than they would be if volatility was higher. But then also remember, volatility has a tendency to mean revert. Like volatility has a tendency
average. So with a long run average VIX at like maybe 16, 17ish, when you've got a VIX at 1314, like there's some upward pressure for volatility to expand. Now, volatility can live on the lower end of the range for a very, very, very, very,
very, very, very long time. And so, it doesn't mean that it's going to revert back, you know, today or tomorrow or the next week, but statistically, this is a decent time to take a shot by buying premium and playing for that volatility
expansion. Okay, so scenario number two, earnings. World for any length of time, you know we love to trade earnings. There's high lots of action, and honestly, it's just fun. like you want to do something in
something in, you know, some hot stock in the marketplace. You want to take a shot, whatever. Upside, downside, doesn't matter. It's just it's fun. It's engaging to trade earnings. Well, earnings can be a little I don't
crazy, right? The moves after an earnings event can be rather significant. So, it can make a whole lot of sense to maybe buy options going into and large, we do think the opportunity is still on the short side of the
contract even for earnings announcements, but I respect the fact scenario and the situation and say, "Man, I'm looking at AMD earnings. I'm looking at Amazon earnings." And maybe you're trading Nvidia earnings. And
this from the short side. I would much rather do this from the long side." That's totally fair. That's very reasonable. That's going to be a great time and a great scenario for you to lean into the long side of the options
premium. You could buy vertical spreads. butterfly shalt to yesterday's calculated risk. You could buy a lot of calendar spreads, even around earnings and play that long side of the option
contract in a much more controlled way. Okay, scenario number three. It's also strategic diversification, right? But when you've got a portfolio, when you've got a book as the pros call it, and it's mostly short premium, it's
all well and good. You got the probabilities, you got the theta, you got all those things, but just to smooth things out a little bit, just to smooth out your directional bias, just to smooth out your, you know, your exposure
and smooth out the different strategy sets that you might be using, it can make a little bit of sense to add in some long options and add in some long spreads and add in some debit strategies that really kind of balance everything
out. Now, let's be clear about this. You're buying verticals, you're buying calendars, you're buying diagonals. In my humble opinion, those are not going Those are not going to be the things that ultimately kind of get you where
you're trying to go. And so, we can't expect too much out of our long premium strategies and put too much pressure on them to carry the load and carry the supposed to do. And so, it definitely allows us to strategically diversify,
but we just have to temper our expectations, make sure that we're not you know, things that they were really never intended to do. Because remember, when you buy options, especially naked options, but oftentimes even with
are you sacrificing? What are the gotchas, as they say? Well, effectively, probability. You're either going to have like a 50-50 shot, like an at the money spread, or you're going to have very low probability, 10%, 20%, 30% with like a
you also don't have time working for you. So, the two primary pillars of what we like to lean on as a premium seller are essentially going to be either a non-existent or b working against you when you buy premium. So, hopefully now
you can kind of see we can't really expect too much out of these strategies in the end in terms of being a really significant needle mover. And that's why probabilities. We lean on theta. We lean
because we do feel like that's where we're going to be able to tap into the the things that get us where we're trying to go and move the portfolio forward. But still, there's a time and a place to add a little bit of long
now it's a little bit clearer to you what those times are and where those places are. And I'll see you guys next time.
Spac, head of global macro here at Tasty Live with a very special guest joining us uh today. Jeff Curry's here. He's the executive co-chairman of Abacks Commodity Futures Exchange, senior adviser to the Carow Group, and the
global head of former global head of commodities research, I should say, at a little place called Goldman Sachs. Uh welcome, Jeff. >> Hey, it's pleasure to be here. Looking forward to it.
I have uh the perfect guest here I think for the events that we have unfolding in the world. Uh obviously we have some sort of a US Iran deal maybe possibly finally coming together. You've pointed out that uh you can't print molecules
and so all of this stuff may be kind of a moot point. What do you think is going on here? Obviously crude is down on it. Well, I you know, I think there's a couple things creating the downdraft in in prices. One is people were
anticipating a deal, so they've quit buying. There's a buyer strike going on. inventories around the world. They're dropping, which tells you they're withholding their buying. The Chinese are withholding their buying. All of
means you're going to have pent up demand on the other side of the deal. So, that's point number one, the investors liquidating their positions. um anticipation prices are going to drop. Uh by the way, when the deal on
going to rally because you have all of this selling pressure into this, which I would argue is probably the more likely outcome here. Um the the other factor is what's likely this deal has a near-term impact, which it could unleash the pent
impact, which it could unleash the pent up oil that's that's inside the the Gulf not much. Call it 60 plus million barrels. um we're drawing 6 million barrels a day. That gives you buys you 10 days of inventory. That's not a whole
lot. Longer term, there's a much bigger issue here. Um you listen to the likes issue here. Um you listen to the likes of Maris or um Mitsui, they're not willing to take the ships back into the Gulf right now. And the reason being is
they don't see how this thing is solved. So I think there's a lot of unanswered questions right now. Um it means that you know the uncertainty remains high and um you know the sustainability of the deal is highly questioned. The
bottom line is both sides are claiming a victory bragging about things that don't match. So I'm really curious what's going to happen on Friday when these issues come to a head. >> And of course the immediate read through
when this war began was all right. So we have a disruption in oil that means inflationary impetus. uh that means higher yields, that means a stronger dollar, uh that means uh the price of gold comes down. Uh all of this
gold comes down. Uh all of this obviously coming together uh and it's a because of course we have the FOMC policy announcement uh the first one for Kevin Walsh coming up. Do you think that the markets are right to still think
we've got a rate hike on the menu here because all of this is not going to go impetus remains? >> I definitely believe there's, you know, this stuff's not going away quickly because even if you wanted to one, you
they're not willing to start m demining this until they see how it plays out on Friday. Then after you get rid of all the mines, you got to get the ships to come back. That's number one. They got to get the ships to go back in there.
there when the the deal doesn't have all the parties involved um party to it? You The other Gulf States weren't a part of it. [cough] When you look at the likes
it. [cough] When you look at the likes of and I think it was yesterday JD Vance the 300 billion that's owed to the Iranians in this? Yeah, our Gulf friends the Gulf friends, you know, consulted?
Nobody's seen any details of this. Um, these are big questions that need to be come back. Okay, so let's say they agree to bring the ships back in. Then you have to go find the ships and the ships are all out of place right now. Um, it's
six to eight weeks just to get the ships back after you've demined. Um, and then you got to they got to feel really another outbreak and you got your ship tracked in there. I mean, so that means
and be comfortable that that it's a sustainable deal. Um, so I think there's there's a lot of question marks that remain open here, which means in the interim you're still drawing inventories, markets are getting tighter
and creating the potential for substantially more upside. Well, I think the question of inventories is a very important one. I mean I think you you've made uh the point very clearly that much of the kind
of resilience we've had to this oil shock so far has come because inventories have been pulled to such an aggressive extent and certainly not just in the US where it looks like we're exporting uh a lot to kind of cover the
exporting uh a lot to kind of cover the gap but global inventories as well. How much of a of a price shock and how much of a durable price shock do you think there is here? Obviously, we've seen CPI and PPI numbers are already showing
spillover from this into core. Is this something that's with us here? Is this now an inflationary shock that's already in the cake? By the way, you're you're seeing in the numbers already. It can only get worse from here, not better. Um
because the situation is tighter today than it was two months ago, than it was three months ago. It's progressively getting tighter every single day this goes on. So therefore, you have to come to the conclusion that global supply
streams are more stretched today than what they were then. So if it was a problem already in the CPI data, then it's got to even be a bigger problem today and tomorrow until this thing absolutely resolves itself.
>> That's right. Uh okay. So let's then follow that lead. So if this is more of an issue, we already have an economy where the consumer is getting squeezed by this. Certainly not just in the US, but everywhere. Let's focus on the US
for a moment. We have this blistering buildout of AI that's driving the economy, but the consumer is obviously a much bigger piece of the pie, and that's the piece that's getting squeezed. Are we starting to flirt with some sort of
stagflation type of a dynamic? Obviously, you can't call stagflation so early, but is this where we're heading? And what is the Fed supposed to do with this? Well, I I you know the you know the I'm
not going to be going saying I'm not a macro guy. I got to make the you know stagflation type of argument. But I think they're they're stuck between uh think they're they're stuck between uh you know two two conflicting dynamics.
You have AI as a deflationary force and you have um commodity scarcity as an inflationary force. So you got these two things going in very different directions and I think it's we're going to create a lot of cross signals for
them. Um but I also want to make the point is that the deflationary pressures on AI are predicated on the ability that it's like the old tech model infinitely
one's not infinitely scalable at zero marginal cost. This is your standard commodity supply curve because not only does it have data going in it, but it has atoms and molecules who face upward sloping supply curves. So this is not
your standard tech model anymore. This is good oldfashioned commodities. So you know the I like to do is we're play replacing humans with commodities in AI replacing humans with commodities in AI and commod human beings are renewable
commodities are not and I think that point gets lost. So you know that deflationary pressure that comes from traditional tech um frameworks I don't know if it really applies here. This is just good oldfashioned commodity
production and I think this is what's been lost by the investors. They think that these companies are magic and that they you know they can trade at whatever times earnings. These are good old-fashioned cyclical commodity
companies now. They get 10 to 15 multiples not 30 or 40 multiples then that point I think is completely lost on on many of the investors as well as the macro community assuming how deflationary this whole thing is going
>> I actually agree. I think you look at the growth mix at least in the first quarter. You see business investments spinning at over 10% annualized rate. Meanwhile, consumption is growing slower than the economy itself. And you go,
well, I wonder if you spin a tiny piece of the economy that fast. What's going to happen? Inflation. Uh and so, uh the buildout may be uh inflationary and then if this thing is finally built eventually possibly.
uh I think you're spot on here. So for me as I look at this sort of the me as I look at this sort of the national question then becomes we've had national question then becomes we've had these uh really exuberant moves in
stocks this week with uh the announcement of this deal. Ostensibly people are celebrating that we're going to uh get the inflation risk out of the equation. We're going to get oil back down and sort of get back to business as
actually setting up to be a disappointment for stock markets? >> Absolutely. Unfortunately, I think that that is going to be the case. And what one thing I don't understand, the corporates are telling you, I'm not
governments are telling you they're not going to go mind sweep because they don't believe it. So why do US financial markets believe it if the corporates don't? The other foreign governments don't. Um, that's the part that I'm a
little baffled by that they're just selling all of this really hard and trading it as if it is a permanent sticky deal, but the reality is very few participants actually come to that same conclusion.
>> What do you think is the demand destruction aspect of this? I mean, obviously, we're going to get to a place ostensibly, if crude oil keeps marching and the consumer keeps getting squeezed, where it's going to start to bear down
on the economy as a kind of cyclical squeeze. What's the window where that starts to counteract the supply shortages and sort of the bottleneck there? >> I I think the it's not going to happen
in the US, unlikely to happen here in Europe. It's most likely going to happen in emerging markets and places in Asia and we're already beginning and have seen it. So, it's not something that you will likely feel at home, which is part
of the reason why people are ignoring this. It's something that's going to happen more broader on a on a much bigger um um scale than than just happening, you know, on a on a more smaller scale. So I think these are
these are um you know I think you know what'll probably happen is once it encapsulates and becomes bigger is the US is exporting oil and product all around the world. The endgame is that the US prices spike and shut down that
how this probably is. So the Americans will feel it but it's not going to result in demand destruction because they're too rich relative to the rest of the world. >> One last question here. Obviously the
implication for for all of this uh as we've said has been higher rates because the markets have sniffed out the inflationary impetus basically on day one of this war and one of the consequences has been gold prices which
were on a relentless march last year and really the whole precious metals complex has come down significantly because of course these things don't yield anything in in real terms and when rates go up that's not a good thing for them. Uh do
you think that is a thing that's going to continue if we're looking for crude oil to continue to be sticky at these higher levels? Is gold going to continue falling here? >> Yeah, I you know I I put out a piece you
know a few months ago where I was short gold and the reason being is for the rates are going to be higher. They're having to sell gold to fund defense and energy security programs. Um which is putting a lot of downward
pressure. You know, last week we went as low as 4,000. I think the the key message is you don't get long gold again until you're on the back side of this and central banks are now beginning to think about rate cuts. Um, and at that
point, that's why I think you really open up the upside on gold. Um, you know, we 5500 was the previous high. you know, I think, you know, we could even double from there because ultimately you're asking what kind of share of
central bank assets does does gold need to get to um to, you know, you look at places like China um on a global basis, you know, we're somewhere around 27 actually with prices down, we're probably back down about equal to where
US treasuries were as a share of reserve assets. So, call it in that 25 26%. But if you go back to where we were in the 60s or 70s, um you got to push that up
into the 40 to 50% range, which is essentially another doubling in the price from here. Um so that's why I would argue that there's still a lot more upside left to gold. Um however, I wouldn't want to be long today.
>> I'm running snow leopard with this. [music] I'm a Mac. I'm a Mac.
brother iPhone in one hand iPad in the other pop open top Apple logo shining on the back. [music] That's why all these player haters know that I'm the Mac. Easier to see a nun with VD than to see me ever typing on a PC. [music] So if
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surfaces where white [music] light is reflected. Plastic case, Apple store. [music] toolbar to see if networks are detected. Use my sides swipe. Applications hidden in it. This is Mac, [ __ ] You're just living in it.
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logo shining off the marble on the table top. So if you see me, [music] then you see the star. Any place I sit down, call that the genius bar. Looks like I'm >> But to really know the truth, just taking pictures of my fine self and
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It is still Wednesday, June 17th, 2026, which means it's time for a Fed rate decision here at the top of the hour. Kevin Worsh's first meeting as Fed share. So, we're bringing it to you live. Next 20 minutes, Illy and I will
decision itself. Tom Preston will come on about 1:10 Eastern, 12:10 Central time to talk through the trade setups as we get ready for that press conference. Ilia, before we get there into the breakdown of what could change here at
plots, new summary of economic projections coming up with inflation, with growth, with unemployment. Let's talk about how this market's set up here. Uh Laura, we can go to the charts right now. S&P 500 down just two and a
right now. S&P 500 down just two and a half points, 75.84. Volatility a touch higher over the course of today's session. The VIX sitting in right now just under 17 still 1665 right off the session high but still about 25 cents
of a better outperformance going into this and like the S&P somewhat higher vol today. It's up by 4/10en of a percent 132 points. Not much really to do there about anything. Bonds of course are probably the most important part of
this move today. They might be the lynch pin upon which everything sits. Notes here are slightly weaker down by one tick sitting at 10929 ZB where volatility is very low. It's up by one tick. By the way, a negative IVR in the
platform that scaled 0 to 100. So when you go above 100, you're thinking in percentage terms. A 105 IVR means uh volatility is 5% higher than the previous high reading over the past 52 weeks. A negative IVR means volatility
right now is 0.9% lower than where it's been over the past 52 weeks. So, this is a new cycle low in bond v as it were. Ilia, we want to keep little bit of a bounce, although it's kind of pinned against that April 17th
has made its way through the day through some of these various comments in Iran around the G7 meeting. We have gold prices here, which are likewise bouncing a little bit, but maybe haven't turned a corner just yet. through the end of the
day. Ilia, before we get to you, what is the S&P 500 doing? Futures market here 38 points, 39 points rest of the session. So, around half a percent or
so. Okay, that's where the market stands. Ilia 2:00 we get this new summary of economic projections that could trigger a market reaction because the market's perception of where the Fed thinks inflation and then visav rates
are going would be an interpolation. So what what do we know about the dot plots going to tell us in about 5 minutes time? >> I think you look at GDP numbers here, December projection versus the update in
March and you see higher numbers. You look at um inflation and you go, okay, December numbers versus March update, higher numbers. You look at the long run
projection for GDP increased from 1.8 to 2%. the parallel long run increase in the Fed funds rate projection from 3 to 3.1. What is this telling you? It's
telling you that there is a pickup in inflation for pro this former now chair Powell in the last press conference that he did when the Fed last convened. This was of course
after these um forecasts. there was an inter uh an interme meeting gap there. And so you had him come out and say, "Hey, um we're not saying that we're of this war," which at that point had
only just started. No, no, we're saying there were reasons to to think the economy was reflating before that. We're not even there yet as far as this energy shock. We'll see what the energy shock does. And so the way that
this has been set up is you've got Kevin Walsh ostensibly coming in as new chair with a mandate to be dovish by a very insistent White House. Meanwhile, you have a hawkish committee. And so the biggest question here is going to be how
does he do in the press conference and does the Fed appear paralyzed because they're going to have to see something really dramatic this way or that before this log jam can get cleared up.
We're still only down by two and a half points here in the S&P 500. 7585 Ilia. I ES or MEES right now across any expiration. I am still leaning long deltas in the NASDAQ here. Though I I'm paying attention to how this market
enough pullback, it might cause me to trim my exposure and take off the positions that I have on here, at least in MNQ temporarily speaking. uh especially the short uh put spreads as it were. Over the course of the last
put spreads as we got close to that 50-day moving average, anticipating that trend follower, I'm going to have to buy a dip at what is a key trend level. Um if we start to see today as we go into the close, right, a NASDAQ that all of a
sudden loses its recent pivot point. This pivot point being the high that we had here on June 9th, 30,138.75. I may just take whatever little profits around in the short put spreads in NASDAQ and see where this market settles
50-day moving average that offers an opportunity for a better chance at re-entry as it were. But with a a 16 and change VIX right now, if we get that movement here and yields start going up and stocks getting start getting
there's some breathing room, some blue skies, should I say, um that would allow little bit more because it's not like we're starting this meeting with a 22 or 23 VIX, right? I mean I've been sitting uh in
exposure on the short side but it's structured as uh short call verticals and um there was very rich premium to have there so much so that uh the max loss I locked in at the time was smaller than the premium received up front. Now
again I stress and I stress this is not free money because the markets will always find a way. After all we've seen negative crude oil just in recent years. Who would have thought that's even a conceivable thing? But the markets will
find a way. Nevertheless, I'm in this exposure against the highs from the beginning of the month, late May. And so for me, this is the market kind of waiting to see whether that top really is the top that I thought it was.
So I'm sitting in those positions. I've got all kinds of time on them. Still 44 days on them. And uh some of this exposure I've had for over for a month. exposure I've had for over for a month. So we'll see. But I'm biased in the
direction of higher rates with my exposure. I'm long uh the dollar. Uh I'm short risk. I'm spying what's going to happen here with bonds and with gold because if the upshot here ends up being stocks down, dollar up, but yen also up
and gold up and bonds up, then the markets has uh are are spying some sort markets has uh are are spying some sort of a cyclical risk that the Fed is um nodding at when it says uh what it says today.
notes before the meeting. I I just bought the plane 109 put. Tom Preston $1563. Look, I'm leaning along deltas in stocks right now. Uh what what's the worst thing that could happen to me here? A
rate shock, right? Rates all of a sudden start shooting up twos, fives, tens, the the stock stuff starts to go under. But we're going into this meeting, Ilia. S&P >> Very funny how that works out on a day like today. We're going to get this new
announcement here any moment now. A little bit of jiggle there. 7570 in the S&P 500. So, just keep that in mind as it were. I'm waiting to see what the statement says because I have not seen any of the numbers cross my screen just
yet. >> We got lower gold and a stronger dollar >> Out the gate, we have the Fed has left rates unchanged, which is the consensus expectation going in today. That much.
Sibo CM Fed watch tool was very clear that there was 1% chance or so for um a rate rise today. But this new summary of the FOPSY summary of economic projections loaded up on their website.
>> Well, this this statement is um significantly revised. >> Well, naturally, >> and these the summary of economic projections here is significantly more hawkish. Uh we're we're betting on hikes
here um in this summary of economic projections for this year. >> And you're seeing stocks give up their gains here. S&P is now down 30 points or that's come out at the top of the hour right now. Inflation 3.6% from 2.7.
>> But dare I say, Ilia, they're saying it's transitory for next year only 2.3 >> This is going to be a very interesting conversation that Worsh has to explain to the markets here about why they're not expecting inflation to go bump in
that's the Sue saying this market needs to hear. But you mentioned the changes in in projection overall. GDP's in a touch. You're getting much faster inflation both in the PCE and in the core. And in fact, in the core next
year, 2.5 from 2.2. You mentioned where the Fed funds rate will be. >> The Fed is telling us from 3.4 to 3.8. My math isn't that good, but 3.8US 3.4 My math isn't that good, but 3.8US 3.4 is 0.4. And that is more than 0.25.
0.25. >> It most certainly is. Note also that the >> It most certainly is. Note also that the path back is uh to 3.4 by 2028. So we get to where we thought we were going to be this year
be this year only in two years time. We get back to where we thought we were going to be with 50 basis points and cuts this year in two years time. This is a very hawkish rethink here. So the market
going into today is pricing in 73% chance of at least one hike this year. The Fed is telling us that that's under counting it. That the market should be pricing in perhaps a little bit more than that. As things stand, they are
they stand ready to deliver potentially more than one hike. Right now you can see in the SR3 Z6 contract Ilia right down to 4%. >> Now trading right at 96. the market has gone to go price in immediately that 4%
Fed funds rate which is for what it's worth when we had after that non-firm the Fed funds rate cratered into 4% again that's when the S&P 500 the NASDAQ here is now in negative territory off by 210 of a percent I I wonder though
the Fed telling us that they may have to hike they're expressing to the market that they know that there's a problem here wheel. >> Yeah.
What does this do for the bond market? Well, this is where things get really, Well, this is where things get really, really interesting because if you look really interesting because if you look at what's happening now, sort of as this
is getting baked into the cake in real time, I mean, just take a look at what ZN is doing here. And you can see we have an immediate re reaction and it is
have an immediate re reaction and it is a sharp move higher in rates. Now, we'll see how this settles. We still have the press conference to go. And uh as I was saying when I was uh previewing this yesterday, the way that you arrive at
yesterday, the way that you arrive at the dance here, right, the committee is clearly hawkish and we've heard this and you and I were talking about it before this came across the risk of overheating.
across the risk of overheating. >> Kevin Walsh came here with a mandate to >> Kevin Walsh came here with a mandate to be dovish, but what can he do? Well, the first round of excuses to the White House are probably going to be, "Well,
the committee did it. What am I supposed to do? I can't outvote all of them." And so, you're probably going to get some level of moderating of this influence here. When you get the press conference, he's
probably going to come out and try to soothe this somehow. And we'll see how it all shakes out in the end. It'll be his first press the end. It'll be his first press conference. Even Powell uh had a few
iffy press conferences there in the beginning and he'd been Fed governor for a few years before he became chair. Kevin Walsh hasn't been a Fed uh official for a lot of years. >> So I I want to bring this people's
>> massive. >> Uh off 50 off 50 bucks giving up the day's gains. It's an area where we had a former swing low back at the end of May. through on June 9th and failed. We did
again on June 15th and failed today. Maybe another failure. And for the faint of heart out here, Ilia, this 4hour close right now above the prior candle high, below the prior candle low. I'm seeing this here right now. This might
be a good MGC or maybe 10Z short. I'm going to be looking at this as a 10Z short depending on how this candle closes. Obviously, I've been short uh for a while, but as we talked about, I took the positions
off um thankfully after the first 4hour candle post after the first 4hour candle post ceasefire. Um and so I got to keep my ceasefire. Um and so I got to keep my gains for the most part and it's been
to be short gold. So, I'm going to be looking to get back in. >> Uh I I just actually sold one uh a 10Z contract here. Um, given that the sell-off has accelerated, NASDAQ's down 610 of a percent, S&P down by 8/10 of a
engulfing bar, it's happening at the exact level where you'd want it to happen. And if we're looking at uh rate hikes that are coming onto the board anticipating, which clearly not, then gold could get softened up in this
the Fed is telling us it's just one or one and a half, maybe two. You know, is shortlived. So if there's evidence that accumulates over the next few months that inflation is making its way through the system in a compounding
fashion, [clears throat] then you could get more hikes on the board right now, year. So it's not something that you want to dismiss handily. But I I want to hear what Kevin Walsh has to say, Ilia, because the way that he talks about the
>> right? If he says like we think it's going to be transitory and these are just insurance hikes in order to prevent things from getting out of control, we to hike just yet. We'll see what happens with oil after the straight reopens.
Come the next meeting, they may turn around and have a totally different view and start to massage the sidelines here and try to get people to, you know, re of what their ultimate view is. So, we're only off half a percent right now.
hike coming onto the board that wasn't priced in, I would expect a little bit more weakness here, which is why Wors carries so much importance for me. >> Yeah. I mean, I think we need to look at that. If you look at the statement, it
that. If you look at the statement, it is bare bones to say the least. I mean, >> Let me let me pull this up here. This is >> barely a statement here. >> There's nothing here, >> right? So, there's no detail. It's all
the fy. It's all the dot plots and the projections that are doing the lifting >> So, get ready everybody. This is how the Fed communicates. Now, ostensibly, this is a preview of the Worsh Fed. It issues statements in tweetable chunks and u
that's gonna be aligned with what Kevin Walsh has talked about before. He's been a critic of excessive forward guidance. Uh and so it looks like we have some strategic ambiguity here. That only means the press conference is going to
be that much more impactful. The market doesn't have a lot to go on here. U mind you the statement has been approved in a 120 vote. So Kevin Walsh did not vote not. >> What are the That to me is one of the
undercurrens of this uh little message here. Ilia, where do they usually put here. Ilia, where do they usually put the uh vote announcement on the >> right? They usually put it at the bottom in the Powell era and in the Yellen era
first time that I feel like >> I mean the POW Powell Fed Followed the >> I mean the POW Powell Fed Followed the Bernanki Yellen script. So they're telling you up front 120. It's usually at it's usually the last thing here.
the action and all these other statements. It would be like Jerome Powell, John Williams, Michael B. None of those names are listed. Uh they usually explain why they're doing what they're doing up front before they get
to the conclusion, right? Hey, the economy is doing this. Inflation's doing we're worried about. And so because of all those things, >> this is why we're doing no change, a hike, a cut.
This is really fascinating. It feels like this is short because Wars doesn't want the president to misinterpret things. He himself. So, the bottom of the hour, Ilia, it's
quick review before you head out the door and we swap TP in for you. Uh we were talking about the level here in the NASDAQ around 30,000. That swing level if we get through the >> June 9th. You could see how we're
watching it on the close before I lift any of my NASDAQ long delta trades right now. If that line is held and we just hold up here, the beauty of the short put spread is I don't need this thing to rally. Time decay can work for me and so
I'll have no reason to just sit tight and let time go off the clock. But Ilia, talk about later on over time. We'll check in on that gold trade as the day this Fed meeting. And wow, I can't believe they're looking at that much
inflation. At least they're being honest about it. >> Well, there's that. Let's see how Kevin's going to spin this thing and where all this dust finally settles >> before before TP comes on. Just quick,
what's the number one thing to watch during the press conference? >> He's got to he's got to make sense of the hike being an indication and not a given and stress that he doesn't like the dot plot, thereby neutering it.
you looking at ZN? >> I'm looking at I'm looking at ZN. I'm >> Tom's going to be here in five minutes. Tom's going to be here in 5 minutes, by the way. So, we'll keep going with this here. Uh ZT sitting near the lows of the
>> How you and I have discussed in recent sessions the the framework that the >> Yeah. >> When Treasury yields shot higher as a result of them cutting rates. What does it tell you about the market
where you're having yields drift up across the curve in a parallel fashion for now? It's not like we're seeing any sort of twist just yet. Um, but what bond market's interpreting this? Is this not enough? Or maybe this is the
send to let the market know we're not going to do a repeat of 2022 again. I think what officials clearly are trying to do is tell the markets we're not going to repeat 2022 again and get this out of hand. Um, I think it also seems
to suggest that the market as a whole is recognizing the committee will not be recognizing the committee will not be cowed if there were any kind of dovish pressure from the new Fed chair. It is not obvious in this dot plot. And to his
credit, there is no effort to suppress that kind of signaling here. I mean, clearly this is a very hawkish dot plot. It reflects each individual member individually. That is to say, this isn't a cumulative effort. This is a median of
people writing down their own stuff. And clearly, here is the Worsh Fed letting it be known where it stands as a committee. So, I think the market
concerned that somehow this was going to be a culture shift into an unrecognizable institution, that's not what this is. You know, I I I
think that today's meeting is really so much more about I mean, this this maps to me like the June 21 meeting, right? In June 2021, March summary of economic projections, I'm looking at them here now, their 2021
PC inflation was 2.2, the 2022 reading was 2%. At the June 15th 16th meeting, they bumped it up to 3% for 2021 and 2.1% for 2022. In September, it went to
Ilia, at the December meeting is when they pushed up the next year to 4.4%. >> I mean, that June meeting was my tell. I started loading up on the dollar "Okay, they finally seen it. They're going to hike and they're going to hike
in size." >> What is tricky about that moment though up and two-year yields started going up, stocks still rallied for another few >> They did. They had this kind of double dip thing where they had an initial
sell-off going into Jackson Hole. Then they rallied after Jackson Hole into the they rallied after Jackson Hole into the actual start of the hike cycle. You saw the dollar frontr run that by months. So you knew the market knew. But stocks in
their infinite ability to only see that which gets people long. It managed to ignore it for months until they absolutely had to go uh once uh the having a very strong day, bouncing off of its onemon moving average again. Euro
dollar, pound dollar, dollar yen, >> dollar yen, pin near 160. We're going to but Ilia, thank you for sticking around for a little bit longer. Tom Preston is welcome back. >> Yeehaw, Chris
markets. >> We do. We do. Uh Laura, I'm still seeing the ghost of ill. There's Tom. Uh yeah, don't don't lose Ilia. I love Ilia too >> Well, he's he's already he's already moved on. Gone, but not as they say.
>> We'll remember him later for overtime. Tom, um I I'm not sure if you saw the Fed's telling us they're going to have to give us at least one, maybe two hikes this year. Is the market right to be a little upset here? The stock reaction is
obviously negative. >> Yeah, of course. And Chris, like you and I were talking about this morning, this is not a big surprise. Um, it is it's the comments and that for whatever reason, you know, is what's his name?
reason, you know, is what's his name? Warish. Is he bucking um political pressure to become a little bit more hawkish and prone towards increasing interest rates versus the, you know, Trump administration wants to see them
lower? Who knows, right? And who knows? And like you always say, Chris, time will tell. There's a lot of time between now and the um and the and the late fall now and the um and the and the late fall um and um wintertime FOMC meetings. So
down, keep them lower through the summer and say start increasing them in the of the Fed funds futures actually predict they did tick up a little bit higher still. they were um showing um nonzero probabilities of a rate hike in
those fall and winter FOMC meetings. Now they're even a little bit higher still. So spoos now coming back a little bit. Um I was buying the dip, not through any kind of genius call on my part, but I do I just I still Chris have a bullish bias
towards the market. What do you think? >> I I'm I'm with you. I mean, there's part of me mapping this over to what happened in 2021, the Fed did something similar at literally the same juncture where throughout the first half of the year,
concerns about rising inflation. And then you get to June 21 and they make forecast, saying that we could see north of 3% inflation this year. And it spooked the market for a little bit, but the NASDAQ didn't peak until November
21. The S&P didn't peak until January 22. And given all the concerns around the Fed being well not so independent anymore because of Worsh's appointment and given Trump's outsized pressure on wanting rate cuts,
>> maybe maybe it's the bull in me and maybe I'm talking my book here, but the Fed coming out with a 12 to0 vote not to lower rates, not to change rates and inflation forecast and their rate hike forecast, it it might be credibility
affirming which may be more important for the market than anything else. How many times have we seen a dip on Trump trying to fire Powell headlines? >> This might be this might be good. >> No kidding. And and again, it's this is
this isn't really a question about politics. It's just the Chris, as you alluded to, the independence of these agencies. You know what's interesting agencies. You know what's interesting though is look at SMH.
though is look at SMH. The chip stocks are rallying. TSM, AMD, um you know, take your pick. Those things are rallying sharply. And is that a surprise? No. I mean, they're coming. They came off a little bit. The only one
that was down was it in is Nvidia still down? >> Yeah, Nvidia still down a little over a buck right now. So, for whatever reason, buck right now. So, for whatever reason, um, the AI story seems to have survived.
um, the AI story seems to have survived. But check out Space X. And SpaceX, I'm short, put spreads in there. It came back a little bit. It was down about, I think, about $6 earlier. Now it's down
about $3.80. So, it's came back a little bit. I'm hanging on to my put spreads for one more day. That's when they expire. I always like to play. Hey, do I have an opinion about the stock? No. But that's coming back a little bit. So if I
think Chris if the economy is still an AI story and I don't even Chris I don't even know what that means but if it's an AI story
>> and the AI stocks the chip stocks the the the the manufacturing stocks like TSM the chip manufacturing stock if those are all rallying that could provide a lot of still support to the S&Ps because again they are major
S&Ps because again they are major components of that cap weighted index. yesterday. You and I put something on during confirm and send, I believe, which is a good reminder. If you want your uh trade ideas discussed on air
here, send over to research tastabive.com and we'll look at them on confirm and send in the morning, Liz and Jamal or myself and uh Tom here. One of the trades was what was the better value opportunity this week? uh if you're
looking to sell premium in something like SpaceX or in the S&P 500 and Tommy deviation move here which when you go to the trade tab and find your expiry uh on the platform it'll be these dotted lines the short dotted line is the one
standard this greater spaced dotted line here the dashed line we'll call it that's the two standard deviation move so at one standard deviation right now uh yesterday it was like 3 and a half to one it's a little bit worse than that
>> but that is the case where if you're looking at SpaceX on the same timeline, we'll call it like 30 days in the S&P versus SpaceX, you'd be selling what the versus SpaceX, you'd be selling what the we'll go $5 wide 140 135 here. Uh not
great, but in the S&P Not great, but in the S&P 500 at 30 days to go out to one the S&P 500 at 30 days to go out to one standard deviation, you know, [laughter] not much more gain. I'd rather just play in SpaceX right now,
>> I agree. You know what's interesting about SpaceX? By the way, the VIX is about SpaceX? By the way, the VIX is only up 76 trading just turning 1717. So, it's up a little bit on the sell-off. What's interesting about
SpaceX, Chris, is how much volatility has come in. Those one-day options, or at least, you know, like yesterday, they were two day two days ago, they were three day. Those short-term options, the implied volatility in the June
expiration was like 220%. Now, it's about 162. You say, "Well, geez, Tom, 162 is still, you know, 10 times bigger than the VIX." Yeah, I get it, but it's way down. Those July options trading at a 102% volatility,
options trading at a 102% volatility, they were up around, I think, 180 190 if memory serves. So, volatility is coming in in SpaceX. Why?
in in SpaceX. Why? It's becoming unknown. Okay. It's does that mean we know the financials of it? No, of course not. But now we know, okay, it's a $197 stock. It's moving around, you know, five, six bucks at a
at a time. That sort of defines the magnitude of the potential price moves. And Chris, as you pointed out, those standard deviation moves on the on the standard deviation moves on the on the trade page, those are based on the stock
or index's volatility. Those aren't we don't just make those things up. We look don't just make those things up. We look at the overall volatility of the SP uh the SpaceX options with one day to go. We take that volatility. We run it
through a probability calculator and determine what those one two standard deviations are. It's it's all math. It's all quantified. It's not Chris Chris's
opinion. It's not my opinion. It's what the market says the magnitude could be. mean, it really doesn't matter what stock you look at. you're gonna find everywhere you go and that's a good place to anchor trades and and quite
neutral volatility seller when I do this in like oil for example I just go out to the one standard deviation go like a dollar or two wide around it short put go fishing when we're not at a geopolitical risk period and you don't
work Tom but you get a few of those trades in your profile we're like I don't need to think about this just it's unlikely to hit those levels >> you know what Chris I'm sorry go What point? You want to make another point?
>> No, no, all you. >> Okay. So, what I was going to say is it >> Okay. So, what I was going to say is it is a place to start. So, if I open up the platform and I look at, I don't know, you know, NASDAQ, if I look at
crude oil, if I look at Tesla, if I look at SpaceX, I'm presented with this array of option prices. Where do I start? What do I do? Yeah, I've been doing this for 30 years. I zero right into what I want to see. But instead of spending 30 years
figuring this out, you can use the tools on the platform. And that one standard deviation, two standard deviation, take your pick. That level gets you on the playing field. And just like Chris was saying, it's okay. Maybe I sell that one
standard deviation put. Oh jeez, I'm not really getting enough credit for that. Fine. Move it to a closer strike, to a closer to the at the money. Fine. It's the those lines give you a place to start. They get you on the dance floor.
Okay. You pick your partner once you're on the dance floor, right? And if you need to adjust higher or lower, do it that way. But like I said, it it's a place to start. Um, okay. I don't want to come out on on
left field at you, Chris, and I'm not sure how much you've heard about this yet, but it is could be the next geopolitical excitement. Did you hear geopolitical excitement. Did you hear about the Russian
Navy ships circling around the English Channel and taking pot shots at a I Channel and taking pot shots at a I guess at a at a at a British yacht after um the British Navy seized one of their shadow tankers? Have you seen that news
yet? >> I haven't. I haven't. I'm always, you the echo. >> And I don't want to put you, Chris. I That's not my intent. >> No. No. One of my favorite, one of my
favorite, you know, tidbits about history is how World War I gets started. Right. In the early days of World War I, uh uh you have this British uh vessel that's chasing a German frigot around the Mediterranean and the the the German
frigots's uh navigation equipment goes ary and so they just got to just start sailing. And so as they do, where do they go? They end up sailing towards And they are received by the Ottoman Empire. And so the UK is like,
[laughter] we're declaring war on you too simply because they sailed into the wrong port. So worse started over these kind of things. >> Well, see it's that's exactly right. And I think everybody's a little bit nervous
about what was going on with Iran and maybe we're stepping back from it. Maybe we're not. Whatever is happening in the English Channel may be over by tomorrow afternoon. Who knows? But I do think it
is a potential um a potential crisis that could royal the market and maybe send these things lower. The S&Ps right now, S&P right now is down back down to 45.
So, it's been bouncing around 20 points at a time. Chris, I know you bought a at a time. Chris, I know you bought a was it a ZN put earlier this morning? >> Uh that is true. I did buy a ZN put this morning just to kind of given that I'm
that I'm worried about today was a bit of a rate move here. So, I got the 109. I could theoretically now flip it for a a nothing. So, we're going to need to to work out. But on the flip side, if it doesn't work out, it probably means that
that much more. >> Well, it is, as you pointed out earlier, >> Well, it is, as you pointed out earlier, and and again, just to be very clear, I sold the call spread instead. But two traders, two trades. That's what it
traders, two trades. That's what it means. The we're down 10 cents right now means. The we're down 10 cents right now or 10 ticks in ZN ZB. We're only down five. That is a very unusual move. Typically, you'll see
bonds move about two times, two and a half times what the notes will, and we're not seeing that today. Not sure what that means entirely, but they're hitting the ZNS a little bit harder um than the ZBS.
>> You know, if we think about the long end of the curve in terms of inflation they're going to have to hike more than they previously thought, it kind of makes sense to me that we would see long yields not necessarily
blow out, right? I I always go back to September 24. The Fed gave us a 50 basis point cut. Yields went up because the market said, "You're this is too loose of a policy. you're going to stoke inflation and growth. Um, so there is
my end here where I'm trying to figure out in my head right now. Yeah, yields are up a little bit, but they could be up a lot more right now. And you look at up a lot more right now. And you look at ZB here and they're not up at all.
Well, it's that's exactly right. And there's a huge difference along the yield curve about the impact of an FOMC meeting which is again talking about earlier this morning is our overnight rates. Okay, overnight literally um that
banks lend borrow from the from the Treasury. 30 years out, 10 years out, those are a long way off. Hey Chris, just for the sake of arguing, can you pull up that um threemon um uh T bill yield?
threemon um uh T bill yield? Please, It's okay. This is fine. Either either way, whatever you prefer. It it
basically tells the same story. Um the threemonth the [snorts] three-month yield, like Chris explained earlier, to get the this is a price of a three-month fe. To get the yield, it's 100 minus the price. And right now um it was trading
about what 4% you said. Now it's a little over four um earlier was a little over 4%. You had some um support and resistance lines on there. >> Yeah, just drawing for what the the implied price level is. So right now we
new cycle low. The market's pricing in more hikes by December 2026 than it has >> Right. >> Not something to ignore. That's um that's a pretty steep jump in the threemonth. And you know, is that going
to trickle down into the more consumer sensitive rates? Who knows? But right sensitive rates? Who knows? But right now, uh ZB is only down three ticks and ZN is still down 10. That's a that's a pretty again, it's not huge. We're
talking about sub one point moves in these things, but still um two or three these things, but still um two or three times um if ZN's are moving more than the ZBs by that amount, that's pretty significant.
we get it ready for this Fed meeting. Kevin Walsh is going to be speaking in a few moments. Very, you know, I I know it's I sound sarcastic. I'm very genuinely excited for this. Uh, nine of the 18 officials, Tom, pointed to at
least one hike this year. Six of the nine people who voted for hikes have multiple hikes in 2026. Uh, all that's a good story, but until we actually see the market start to give up the ghost, I'm leaning on this key
simple for me. The rest of the day, I want to see 30,000 hold. It was here May 14th. It was support here, 26th, 27th, back to resistance on June 9th, June
15th, June 12th, excuse me, and now it's a little bit of support here. So, if we're staying above 30,000, the short put spreads that I put on uh last week going to hold them. I may even add another one in at this point in time,
how the market reacts here around Worsh's f first few wards. Uh you get ready for Walsh to speak and and obviously leave an impact on this market. Oil has been slowly creeping back up here over the course of the
>> It hasn't been substantial, but we're kind of getting pinned now near some pretty important lows that we carved out in April. trade. This has had a bit of a roller coaster today. It went up since you and
we were. >> Yeah. I mean this is I I'm not concerned. I'm still going to I'm still going to be bullish on crude oil for the time being in those August um August
time being in those August um August futures. So, I'm short uh I'm short put spreads in the 29day options. I am short the 7374 put spread.
Uh I'm comfortable with that. It's and that that's how I trade. Do I know which way crude oil is going to go? No, I don't. But I look at the probabilities and the probabilities board my favor in that trade. So, I put it on. It is one
that trade. So, I put it on. It is one of 80 positions I have on. [snorts] It's just one part of a portfolio. >> Just one part of the portfolio. Mr. Worsh is up at the podium right now, Tom, which is uh again oh so very very
exciting here. >> Gripping gripping news you're a fellow Fed lover as you so describe yourself on our internal chats. Me and Chris the Fed lovers. Uh 7553 here on the S&P 500. It's a 32
came in right after the reaction to those new dot plots at 7514. So a not a nothing bounce of 40 points right now here Tom volatility is coming too you you briefly mentioned that you know 1749 right now on the VIX it's off the highs
near 1810 or so is this ultimately the thing that equity traders care the most doesn't really get bothered and doesn't get out of bed across the curve what are we doing >> it's certainly indic an an indication um
it's not the only thing that the market's going to look at the market's going to try to absorb whatever inflation tea leaves it gets from Worsh's comments or you know any any other data that they can pull from it.
other data that they can pull from it. But the VIX being again 1773 um it's not panicking yet. It's not panicking and but more to the point panicking and but more to the point Chris this is not a this is not complete
Chris this is not a this is not complete complacency. If we were sub 15 or market is way too complacent. We're due for a sell off. 1755 right now. Uh yeah, with a, you know, with the volatility we're seeing in the S&P today, I'm not
surprised by that by that increase. I think this is this is part for the course. Take note of it, but it is not necessarily, oh my gosh, I got to get short the market.
>> No. And we haven't really seen any of the major lows. I mean, says. The 2-year yield is going to tell you everything you need to know about which way monetary policy is going. And to a certain extent, that's right. When
you look at the historical charts, the 2-year yield moves before the Fed the Fed's probably going to hike sometime down the road. And when it they're going to cut sometime down the road. You really don't need to overthink
it. But if we're going to go by that metric, then the two-year yield, two-year notes here are down at their session low still. And so, the market is that maybe War and Co. are going to be um a little bit more eye on the ball
that inflation's well ahead of its 2% goal and they're they're posing a persistently high burden right now for markets. Uh Tom, I don't really I'm not so concerned about the
this on air a number of times before, but u before he passed away, Paul Vulker wrote a memoir, right? And in his memoir, he talked about the pressure that was put on him by the uh the Reagan administration by uh I think it was
Steve Baker, if I'm remembering the name correctly, who called him in to a a meeting right before the 1982 midterms and was like, "Look, we need you to cut rates." >> Howard Howard. Okay, so there you go.
And and Vulker and Vulkar says, >> "No, go kick rocks. Like we got to defeat inflation." And as I've read other books by Berneni and by Gitener and by Greenspan, this is something that all presidents do. Bush did it. Clinton
did it. Bush too did it. Obama did it. They didn't do it so publicly. >> It's Yeah. And Chris, you're absolutely right. The big difference, and I remember living through those days, the
the the country was the politics were less fraught. Okay. It was you could disagree about what the Fed was doing without hating each other. Today we hate
each other. Okay? And that's that's the difference. People take the Fed a lot than they have >> comments. People call me a Keynesian shill whenever I say anything positive
about the Federal Reserve. >> Right. A Okay. Keynesian shill. People couldn't even The people call you that. You probably couldn't even define Keynesian economics. It's forget forget that that crap that is it's the stuff
like that is is just stupid. But I will say what all these genius But I will say what all these genius economists seems to seem to forget is that you can actually grow your way out of inflation and that I think is the
push towards cutting interest rates. If prices are high, what you can do is get give people more money, basically get more growth to justify those higher
prices. Companies will start manufacturing more products eventually bringing prices down. It's a supply and demand issue. down. It's a supply and demand issue. Yes. The easy and sort of most
straightforward thing got to increase rates, got to make people suffer, got to go through austerity. However, mathematically, you can get to the same place by easing rates. I'm not an economist. I hate those arguments. I'm a
trader. All I care about is how I make money off this stuff. You want to go research this stuff, feel free. But there are two sides to this inflation What's the most interesting opportunity for you as we've seen the market evolve
speaking? Uh the dollar's obviously still stronger here. The NASDAQ is now back in positive territory. For what it's worth, the market seems to be far. He uh by the way, this is a funny quip um regarding this short policy
shorter, simpler, and just the facts. >> Thank god I was so tired of all that nonsense they were putting in it before, [laughter] I suppose. way. I like that shot he's taking, pal. He's like, "Yeah, that other guy,
He's like, "Yeah, that other guy, lawyer. Way too chatty. Way too chatty. lawyer. Way too chatty. Way too chatty. [laughter] that the NASDAQ is up and the SPOS are still down. It's okay. It's a little bit
of divergence. What's IWM doing? Q I looking at QQQs. Q's are up 40 cents. looking at QQQs. Q's are up 40 cents. IWM up a dollar. The small caps are liking this which is kind of unusual. Chris,
traditionally small caps are a little bit more sensitive to higher interest growth stories. they might need to borrow some money, that sort of thing. They don't like higher interest rates. That's the traditional argument. They're
rallying on this news. Um, I think that's interesting. I am I'm short IWM. I've been waiting for a solo for a long time. It's never happened. I may have to
um add some short put spreads to defend that position. Um, but I am still long. I think if you're talking about winners rather than losers and underperformance and overperformance, the S&Ps are underperforming both NASDAQ and Russell.
right now. >> Uh nice little bounce here in the S&P moving average, that yellow line on the chart here. You're seeing in the NASDAQ, we never quite got down to the one month and we are bouncing up now up almost 210
of a percent. Even the Dow Jones, it hit a new alltime high today. That's usually >> that's crazy, >> right? And the Russell here with just a little bit more of a push. Its all-time closing high is 29.88.60.
closing high is 29.88.60. We're at 2983 well 23 2983 we'll call it here just to round it out. Uh so this is a market that is holding up. The tape is through this war press conference. And I think the number one tell for us TP is
the VIX. It looks like it's on the cusp of sliding right back down below 17 again here. >> That's that's just sad. Okay, because I >> That's that's just sad. Okay, because I love volatility and I love the VIX and I
know some people think it's confusing. I confusing. I [laughter]
1706 right now. Uh you're getting your bounce here, Tom. You know, I think I'm gonna have to go over to MNQ watching this bounce play out. What are the day's lows? 30,072.
I've already been peppering in these positions here. Let's let's let's put in else. >> Or or one day. I love the I love the zero DTE and one days for these things. Little bit long coming in.
Little bit long coming in. >> Mhm. Mhm. Mhm. >> Strike. >> What's the future right now? 386
>> Yeah, I'm looking at the 5 days to expiration right now over in MNQU6. lows, if you wanted to really pin this here, I mean, you're risking >> I like that trade. [clears throat] >> You know, it it it's interesting. It's
>> Just look at that. All it comes down to, Chris, is the metrics on that trade. you Chris, is the metrics on that trade. you have about a you can get about 30% return on your risk if your max profit. Load up that short put spread again for
a second. Any short put spread >> right there is fine. Look at the metrics on those trades. I can generate $27 of max profit versus what? $600 of risk. return on capital is actually pretty high. My theta, ignore that theta
number. Um that would be that is POS. you're it's not a negative theta trade. You're actually getting some positive theta with that trade. Ignore that theta number, but you have about a 67% probability of making um at least a
penny before expiration in three in 5 days. That's the kind of trade that I like. Um again, that one gives you a 50% max profit versus a um $150 max loss.
Those are pretty good metrics, Chris. That's why I like that's why I like verticals. selling put spreads, selling call spreads. The the metrics are very attractive. >> Tom, this is this is an attractive trade
>> Tom, this is this is an attractive trade here. 29,900 as our one month average. Um, you know, going this way there. >> Yeah, Chris, you make 36 bucks versus 163 max loss. That's a good riskreward ratio for five
>> Yeah. And just picking up little pieces. And I've already had a bunch of MQ thing that we may need to take an adjustment of because I was talking about this with Ilia here last >> is gold because gold was looking pretty
bad there for a hot second and it kept selling off. Let's go over to uh 10Z I mean, we're basically at the same price where we were when I first got in. It did take a dip below 4,300. I mean, gold the rates argument there is pretty
Tom. >> Gold is weird. Gold gold is just weird. It's it's no longer the the safe haven. It's not the, you know, doesn't attract the flight to quality anymore. It is, you know, still kind of an industrial
metal, I guess. I'm not sure if, you know, China's buying gold, India's countries, the central banks are loading up on gold anymore. I don't know. Um, up on gold anymore. I don't know. Um, they were, but the it was selling off
during this uh Iran war stuff. It's I'm I'm not sure if the strength I It's I'm I'm not sure if the strength I I I'm I'm bearish on gold. across the board from Mor and it may be the most significant thing that he said.
He said that inflation's remitt is to or the inflation task force remmit. Apparently, we now have an inflation task force. By the way, um the inflation drivers of inflation and he sees no
mandate until at least we get back to 2%. This is one of those silly having on the sidelines the past few days that because we can't get back down to 2% the Fed might as well just move their inflation target up to three and
real policy discussions again. That would be a nightmare for the market, would be a nightmare for the market, Tom, right? This is this is Tom, right? This is this is >> silly. No, it that is stupid. And it's
anyway the the whole the whole point of this is the answer is out. We were all about. [sighs and gasps] They're going to sort through the Are they up on the day? >> Almost.
>> I need to close my platform. >> Yeah, I know. We're We're almost there. here, Tom. >> 725. We're coming all the way back. >> 725. We're coming all the way back. That's why I am biased long in the S&Ps.
Tom, I I think this credibility argument that I that we discussed a few moments ago may actually be the the thing I want to hang my hat on here. Borch is telling us that we got a 12 to0 vote puts at the top of the statement. By the way, we're
fact, we're telling you that we may actually have to raise rates more than we previously anticipated. And we're not going to revisit any inflation target. while we're losing. We have to win the game first and then we can revisit it
independence. >> Those are really reassuring things. So, a little bit of a market bounce here, Tom. Um, I'm still in the gold position. I'm obviously still in SpaceX with you. You and me, though, are going to take a
SpaceX. We're going to take a brief break. We're going to go back to our Thanks for stopping in with us on this uh Fed meeting day. In a little bit, of course, and then we'll go to Last Call and overtime as we wind down this
Fed Wednesday. TP, I will see you shortly.
Reward. I would love to say that it's the middle of the week, but as we traders know, it is not. We have a short week this week with Junth this Friday. And I'm joined as my wonderful book host Errol Coleman, who's looking sharp, who
was doing red shirt, synthetic Thursday today, if you will. How are we feeling, >> We'll take it. Uh, red shirt for a red day on SpaceX so far today. Uh, sold a State Farm comments time states [laughter] you saw. Take it. Uh, no, I'm
is the second day that options are being traded on SpaceX. Uh I haven't dabbled myself, but being the first week uh the official full week for SpaceX to be out take a few positions. So I'll be keeping everybody posted whenever we dabble in
for two or three Halloweens in high school. Did you really? It was so easy. It's just khakis, red polo, and I just slap a my name is thing on me and write wasn't like a copout. People were like, "Oh, he's Jake from State Farm." Yeah,
Halloween costume out there. You probably have the equipment to be Jake >> Yeah. I I'll come to you to get a couple Paulies closed. Absolutely. If I see a >> Great branding for that brand. >> It is. It is. Who would have thought?
Cuz you good hands. >> You must know. Oh, they were saying all general got good branding right now. I love the Liberty Mutual commercials with >> They got uh Liu Emu and Doug that it's the emu the guy in a yellow shirt. Those
front of the Statue of Liberty that just says Liberty Liberty over and over. that guy. Uh we have an exciting show planned for you guys today. Uh in about 12 short minutes, we will be joined by Andrew Rder, special guest, options
afficionado, gamma exposure afficionado. We're excited to have him on. But before your positions and today's market action. Uh we got the Tasty Trade platform pulled up here. I guess we could start
with Spy since we have that pulled up. You already know the go is QQ, but we regular S&P Um, we're getting a little bit of a sell off today. A little bit of back and forth action. Uh, a lot of I don't like
to use the word manipulation, but a lot of clear a lot of clear liquidity grabs clearly on both sides of the market. And that's to be expected, especially with something like uh FOMC coming up today at 1:00 Central. So, it seems that a lot
right now uh to make a little bit more definitive decisions whenever that of the market that we've been trading in today at least. you know, very choppy. this morning, you know, we put in some very prominent highs, some very
prominent lows, uh, put in some new day lows, and then pretty much reclaiming and recovering back to pretty much near where we opened up today. So, that's pretty much been the story all morning. Very choppy price action. If you're
intraday trading today, uh, it's it's one of those days where you got to just shorter duration because we can't expect shorter duration because we can't expect any type of full uh, continuations.
get. Uh today's going to be the first day that we have the new Fed chair about that. I know we were talking about how drone pow became a little bit of a coming in. Are you excited just to check out his uh his presence and
where, you know, as a trader, a little little change. It's fun and and welcome. >> Interested to see what the what the new just it's it's a it's a fun little shakeup. I wouldn't say I'm kicking
Jerome Powell to the curb. Respect him for all that he did. He was pretty really well. >> Yeah, he did. But it's uh yeah, little little shakeups fun. Keep things lively. Tune in to the Tasty Live show Instagram
discuss uh the Fed results. >> Yeah, we'll chop it up a little bit mini stream there. Um but yeah, obviously market sort of just uh in in a holding pattern here as we as we await uh what what the new Fed chair has to
say. Um I don't believe that there's it's not in the equation at all that he he's going to change rates, right? >> Yeah. May maybe he'll be holding him there. I that's going to be the consensus going into it. Maybe we get a
But >> with that being said, we got volatility uptick in just a bit there as headed up to this binary event. volatility sitting at 1681. How are you kind of uh viewing volatility right now now that we finally
finally? >> Yeah. Um I mean again I mean I'm just not it would be hard for VIX to do anything that could that could surprise me at this time. Um you know and I mean I'm not surprised to see us climbing up
a little bit today. I mean I suppose that this is a little bit more of a jump in VIX than I would typically expect uh from you know the the very slight downward action that we have going on today. Uh, but I don't know. It's it's
said, I don't really pay attention to volatility until it's over 25 in this >> No, I hear you. I'm kind of piggybacking off that same idea with volatility right for it to do something. Now, it's it's funny because again, when volatility was
trading at around like 20 21, 22, I was kind of sitting there a little bit like contracts very aggressively. Now I'm like, okay, well, I guess we did have something and now I'm really waiting for volatility to do something here. So, uh
spook the market. uh I don't know, a surprise announcement with the Fed I bit. I doubt we get a surprise announcement, but with that being said, volatility is sitting at 1680 right now. Um and again, that's relatively still
high uh for what we've seen in the past, you know, prior to 2020. Again, I I know kind of spoiled with the premiums and volatility we've seen after 2020. uh ask that's been trading over the last couple decades, they'd still tell you 16 17
pretty high uh based off of what they've >> Yes, it's uh it's just Yeah, it's it's what we've become accustomed to and the goalpost just continue to to move higher >> My laptop has decided to take an OS update right now. I I [laughter] clicked
nothing, but I'm sitting here staring at a at a black screen with a with an Apple >> That's hilarious. No, I always I always press delay delay. I'll do it tomorrow. I'll update the computer like 2 years straight. No joke. And then I'm
wondering why my computer's slow. >> Yeah. Now it's just brricked. The Apple And it had it had the questions for the for the guest on it. So yeah, we're off dome. We'll we'll see. We'll see
>> Um you're still short the cues. I see. >> Yeah, I am still short the Q's. Um sold an out of the money call spread there. Uh again, sold the 755s, bought the 760. Uh we collected about $169, so just about three pennies over a third of the
width. I'm pretty I'm pretty uh I am pretty uh what's the word I'm looking much credit I'm really receiving on these things. I really don't want to go underneath a third of the width, right? Like a $166 is really the sweet spot.
Would love to collect more, but anything under $166 in my opinion, it's just not going to be as worth it just because again, the less credit you you take upon a defined risk trade, the more risk that you have overall. It's like the more
credit that we can receive up to that $5 width, the better. um 50% uh you're money and then you're obviously you're playing with fire a little bit there, but it is nice to reduce that risk, get a little bit of extra reward. Um some
sell an undefined risk, get a little bit more profit under your belt, but uh you swing positions when it comes down to uh uh trading the broader market at least. So, we'll keep an eye on QQQ. Um, and as
before we have our guest come in and join us here in about a minute. Check out SNDK. Um, it's it's funny whenever we bring this up, it kind of surprises me how impressive this move has been. I'm still going to be patient to get on
any type of short delta in here. Uh, but SNDK and in Micron still putting in legs to the upside. Um, and it's not really proven any type of backside just yet. kind of what's had my eye. And lastly,
quick look at oil. Uh, and let me know your guys' thoughts on oil. How are you guys kind of positioning right now? I know we had a lot of uh we had a lot of already getting a little bit more short delta onto the downside now that we've
had three, four, five consecutive days to the downside and we've even took out today. Recovering a little bit there now. Uh, but I'm looking at a little bit bit of long delta. Might you might use USO to get a little exposure to the oil
you're kind of uh viewing oil right now. I know there's still more headlines coming out about how things are okay with Iran and it's allowing a little bit more air to come out of these oil names. Uh but we'll keep an eye on it. Um uh
oil definitely seeing a little volatility to the downside though. we are we are ready with our very special guest for today. We can bring him on in. This is Andrew Raider. He is Raider Trader on on Tik Tok Instagram.
Good to see you. How you doing today? >> Good. Doing well, man. Exciting market. Lots lots and lots to talk about. >> Yeah. Andrew, uh, you want to you want like me to do it for you? >> Uh, you can do some of it. I'll finish
that? >> Sure. Uh, Andrew, he he runs uh the the raidertrader.com, which is a a website uh predicated on the idea that options pricing of the underlying asset, not the other way around. Particularly as it as
it pertains to gamma exposure. He has a ton of uh very cool proprietary tools add? >> Yeah, you did one correction. It's the Perfect. >> Absolutely. Yeah. No, you're good. To
build on that though, um there's a lot uh to kind of what I've done in my life. I'm very young, but I really did start out with a focus on options. Uh you begin with, uh a big interest of mine was, well, wait a second, you know, if
you're talking about trading, there's this really, you know, everyone was like, hey, trade equities, it's safer, all this. But when you look at it, if you're a trader and you have edge and edge is only within a defined time
going to play out during this time window, then there's no better asset or that idea than options. And so I was really interested in that and through my was able to develop a few different tools uh that I think are unique to this
industry but also um just build off of knowledge and take it to a professional level as far as how I trade uh with derivatives and and stock alike. So and I'm also curious. I know you're kind of an options guy yourself. What kind of
got you interested in digging a little bit a little deeper in terms of option flow and gamma exposure? Yeah. So I mean over the last uh 10 reading of what options are you know and there's a few great pioneers in this
industry. uh there's people like Jim Carson and other voices to help point people towards this growing uh you know not problem but growing uh you know influence of options on the underlying market that even Charlie Mer and Warren
Buffett have made comments before regarding that they believe options they're starting to take over the market and uh to some degree influence them way market and that's you know I'm sure a lot of your viewers know already but the
exponentially growing. As product issuance grows, as you know, the demand from institutions to hedge these massive long positions grows, you need more options. And with that demand for options, you have a bigger need from
market makers to influence the underlying price because they need to, you know, hedge out their risk for pro providing the supply of options. So, there that that uh ultimately has has influenced the markets.
curious again with the options flow. What are some of the most common products you like to view the options flow from? Is it usually the indices like QQQ, the ETF for NASDAQ or how do you kind of you know view the options
necessary liquidity that makes it attractive to view that gamut exposure? looking at option flows, I start out with the big names and names like Nvidia, Tesla, etc. But what you then realize is that individual orders on
stocks like that are far more impactful or less impactful than something which stock that had previously no option volume. Uh so there's this really balance that between one big large order and you know the the market cap of the
stock. But over time I've really narrowed my focus to kind of what I expect flows to actually do. Uh I mean a lot of people look at individual orders. There's a lot of services like unusual whales or where they track political um
or even just unusual option volumes. What I typically like to look at rather is just the um you know and this is what I kind of built a tool around was basically looking at the total flow volume. So, uh, and ranking that against
historical readings of that stock because that way, you know, a $5 million order on Tesla is not going to be the same impactful order than a $5 million order on something like Kohl's, you know, KSS where there's no option
>> No, I didn't mean to cut you off. I'm sorry, but if if you don't mind, little bit of the sauce. Give us just an idea of some of those playbooks that you I assume you use some of those tools that you like like gamma exposure
options flow to then gain a little bit more confidence and conviction in terms of what you're doing. But what does a playbook trade look like for you? bunch of simple ones and I'll just give you a time relevant one and then I'll
kind of give you another maybe a more uh classic one. Uh but even with SpaceX yesterday, you guys know that options were introduced to SpaceX yesterday and uh there was a big runup into spa SpaceX
you guys saw in the after hours that it spiked to 230 after already 2 days up. the after hours and then we opened right around 2:15 at 4 a.m. on SpaceX. Well, a simple playbook there with options is
just simply anchoring in the idea that with options now unlocking you have uh a lot of people institutions who are unhedged who are long SpaceX and hedge funds who are buying them would like to hedge because it's up so much. So the
lot of people to buy puts and that's going to drive a lot of selling pressure because again when you as a participant go and buy puts market makers sell you that put and they have you know naked exposure to that put which they can take
sell equity to hedge. So that creates selling pressure on the market and you know the thesis yesterday which was actually a PR trade in my career was actually a PR trade in my career was shorting um SpaceX uh to to have that.
squeezed everyone out but on that backside you can see even today it's just melting melting melting lower uh and that's again just a very simple playbook of with IPOs in the future such as open AI and even anthropic coming up
you can deploy this idea and really look for you know if there's a big runup into these option unlocks there is a very strong case to say that they could go >> I love it and uh you know zoom zooming out a little bit here obviously options
are are traditionally the the focus of the tasty audience but as your research increasingly drive price action rather than just reflect it. Do you think we're at a point where the tail is fully wagging the dog here? And if that's the
traditional investors? >> Yeah, sure. So, I think this is situational. Um, you know, there is increased magnitude of, uh, I guess impact during certain market environments, uh, and less so in others.
So, for example, when you're in a market where, uh, you know, markets have been will kind of lead into another playbook, but I I think we're not quite to the the options are fully wagging the market, per se, uh because at the end of
the day, it's ultimately about stocks and where options really thrive is not only boosting the volatility of these stocks, but adding, you know, a little bit of a deeper layer of information that you don't get otherwise in the uh
example, one of the other playbooks I was going to tell you guys about is just really simple. what actually worked out on June 5th um on SPY where it it's super simple and I uh you know you kind of just expect it's called what I call
you have a runup in a market where it's positive gamma so you know 10 20 days in a row of the market's really healthy really green indices and positive gamma their ranges are compressed and they're
just climbing higher all of the sudden after you know a 10 20-day period you'll see one day whether it's a catalyst like it was on June 5th kind of gap it down below the negative gamma jlip and when that happens for the first time in 10 to
simple playbook it is in the morning you want to look to short pre-market lows. You want to look to um you know buy uh basically short anything with 0DT puts or uh with equity short a pre-market low or first opening drive or or break and
I like with zero DTES is taking an afternoon roll. So oftent times you'll open or below the JEX flip and then it'll start to roll over into the afternoon. And the kind of mechanics there is that in the morning you'll see
that IV spike uh into the afternoons volumes decrease. all these zerodes start to decay causing a bounce. Market makers buying back equity and then as those decay happens that afternoon roll can give really great prices for zero
DTE options uh because they actually decay often more so uh than even they were at the morning. So you get the same price but a cheaper contract. Uh really to. Yeah. >> No, Andrew, I had uh I had actually
entries and exits that you took on SpaceX. I had seen that screenshot. So sometimes. Sometimes you'll take more scalping opportunities if the volatility that? Is that accurate? >> Yeah, so we uh you know trading at a
different strategies you do. You know, you're expected here to trade um a variety of strategies for based off what the market environment is. And something like SpaceX is not a, you know, you you can't short this as it's going up uh
three days in a row super strong and expect it to go down to zero. Uh so it is a move tomove trade there. And so the best because we didn't have options, we have to really trade that with equity. But there are instances in significant
called a hedge trade where for example on car um what we'll do is grab calls in the short term because we believe car as you could kind of see it break through 200 300 you know it's going to turn into an overextension eventually, right? It's
going to come back to earth eventually. And because we know that what we can do is throw on some calls and say we're going to be long until it's a good short We know what a good short looks like. And so what we'll do is longs
still have a cushion of calls and then be be able to sell those calls to to have a bigger stop. So uh that's kind of the different dynamics we'll do. Yeah, most of the time we are uh scalping intraday, but the the big trades we take
>> No, that's awesome. What what's kind of the thresh I know I'm pulling up pulling about the car the car ticker, right? Where we had that kind of parabolic move >> Um >> what is the threshold to start buying
these calls to start hedging that position when understanding that the the the exact top but what type of what is the threshold for when that hedging becomes a little bit more attractive? >> Yeah. So it's really interesting because
playbook one of the most important thing for any traders is to have a uh the best examples you know go gra go out and grab 10 20 30 examples of how this trade overextension short. And so, if you can recall different setups such as um
silver, such as circle, um such as uh you know, even prior names like MSTR in 2024, these playbooks, what you'll find is in the final innings often of these daily overextension shorts is you get expanding price and volume. You know, it
your phone. Expanding price and volume starting to go parabolic. Dollar volume is increasing at higher prices. And once that starts to happen, once implied volatilities again with options become so unsustainable, the argument for a top
for something like car, what actually happened was or even silver, this is a great chart, um silver or gold was you had the biggest gap in the last 4 days. Um you had just a tremendous blowout of that first kind of red day and that was
like, okay, this is pretty crazy. having the biggest gap, one of the biggest gaps in the trend so high up at these altitudes is a big sign of exhaustion. And so off the morning, you're looking, hey, you know, how can I position into
options short now that you were long calls? But specifically for when we're deploying long calls, uh it's often an uncomfortable place when we're like have an imagination because you're buying calls at a really uncomfortable
good edge because not a lot of people are expecting to continue higher. Um but hedge, it's really when those big gaps come in, when huge volume to the upside or an unsustainable move happens and in the case of commodities, oftent times
positioning short in in the early AM or RPMs. >> Absolutely fascinating. Yeah. And I would, you know, I I would I would ask as well circling back a little bit more into your framework, but uh you know,
gamma exposure, open interest, these things are becoming more popular. And as think that there's any risk that your edge gets arbitrageed away? Like what at what point would you would you begin to rethink your framework on those things?
believe that options data is incredibly powerful. I think some of it can be turned into automated strategies or at least uh you know but what what ultimately to me options data is is a tool in my toolbox. So for example, open
give us from a basic information standpoint. It can give us levels of importance. It can give us uh locations where we can expect uh maybe a turn or do is say I'm going to buy off the biggest open interest strike every time
and make money. Uh we know that doesn't have edge. And so we have to kind of broader playbook. So for example, if you're a breakout trader, you know, how it can give you a lot of data? Well, for
which was recently breaking out into all-time highs extremely aggressively, for technical analysis to the upside. And so, you know, there's no equity volume you can really see. So, what are the best ways to look at maybe some
levels? Well, definitely the options position because that can give you a otherwise get in the equity chart or in the price chart. So, uh using options there's a few things in the market that will never be uh edged or eroded away
rather. Um and that is human psychology and you know that's going to stick working forever. If the stock is on a catalyst and it's a good one and people institution is out there, they're not going to be able to arb that out. And so
for stuff like options especially, options are always going to be mispriced in some areas of the market. Options are always going to be uh the the best vessel in in underpriced for what could actually happen in the future because it
can't see everything in the future. Um so things like open interest those and even uh like option volumes those are those I think are here to stay and you them and and not worry about that. >> So what you're saying is human behavior
time. >> That's for better or worse. Uh, you yeah, that's something we we talk about all the time is it's all the markets are just one big psychological thing and human psychology is is never going to
upside all the time. We exaggerate moves to the downside. Quickly, I know you had points or some of the criteria that you'll have for some of these playbook a moment. >> Is dollar volume something you you track
moves? And then also, are you just taking the average volume traded that taking the average volume traded that day multiplied by uh multiplied by the looking at there? >> Yeah, there's there's a few simple ways
you can do it. You can literally just do dollars the stock times the volume from VWOP like what was the shares traded at VWOP um and things like that. I think you know to keep it simple dollar volume is just an idea that you
know you're trading big volume at higher prices. So, if you have a day with 10 million volume and then the stock's at $100 and then you have, you know, uh it goes up to $400 the next day, but it only did 8 million volume. Well, just
because it did 8 million volume, it did less volume. The dollar volume was still insane. And so, it was it was way more because it's four times the price. So, it's harder. It's even though it did less volume, it's still harder to
sustain that. So I think not a lot of traders look at that but you know just to keep it simple like uh you know something like uh silver or SNDK had this very situation where you're going at higher and higher prices if you want
to short something that's going up that much you would you know hope that the ultimately what a daily overextension short is is unsustainable price action over a certain period of time. So what is unsustainable? Well, you have to
with volume and dollar volume. >> Yeah. Absolutely. Absolutely. Yeah. Um, can keep this brief if you'd like, but uh options volume and structured product product issuance have really exploded over the last decade. What's one market
that simply didn't exist 10 years ago because of because of this explosion? >> Um, I would think just the pure the the pure violence of momentum we're seeing. I mean, we're seeing we're seeing breakouts. I mean, think about this.
companies in the world make 100 plus billion dollar moves and and breakouts to take weeks for something like ARM to get to those prices or it used to take weeks for memories to explode that high. And now we're getting it in 3 to 4 days.
And if you miss that 3 to 4 day window, it's it's over. So just the sheer opportunity uh that we're getting now is of what you can make in in multitudes
Um and I think that's why you're seeing a lot more traders. I mean even if you guys are into like the market wizards books and stuff, you're seeing a lot of make an absurd amount of money. I mean I
>> on Instagram and Tik Tok the raiderreport.com. Be sure to go check there. That's all the time that we're going to have for today. We will be right back here on the uh later today at 1:30 p.m. Central Standard Time. Be sure
subscribe to the Tasty Live YouTube channel so you don't miss what we have coming up next. We will see you guys next time.
>> Thank you. Thank you. >> He's an actual she is. K, you found the place. It's good. You're not stupid. [laughter]
loved every one of them. So, maybe you're the next one. I'm having a good it got really good again. So, I'm feeling all right. Hey, where'd you go to college? I would. >> Me? University of Penn State Community
those, did you? Yep. The Fighting Rams. >> Oh, sexual fantasies? >> I do. My parents are watching. They're sitting on a rainbow. I'm half man, half giraffe, and I'm dressed like Brett
know. talking about it gets me pretty hot though. Uh oh, there it is. >> His pants just got tighter. I'm a vampire. Can you believe that? >> Uh-oh. Watch yourself. We don't want to get hit by a car. My brother did that
>> God, I'm not serious. >> Yeah, pretty serious. Are we getting serious? I think so. How many kids do I want? Five. 11. First meal. Here we go. >> This is on you. So much time is flying by. You're very funny. Does anybody ever
>> Well, you're not that funny, so don't worry about it. you know everything about me. I feel like I'm opening up so much. God, I'm scared. This thing is moving so fast. [laughter] Wow. I haven't cried like
this in a long time. Are these tears? >> Uh-oh. Here we are. Front door. Big first kiss moment. >> Oh,
for me. You're a great kid. >> Global markets never sleep. Explore them with Forex on Tasty Trade. Get in on 80
with Forex on Tasty Trade. Get in on 80 plus Forex pairs 24 hours a day, 5 days plus Forex pairs 24 hours a day, 5 days a week. FX [music] marks the spot. Trade a week. FX [music] marks the spot. Trade it on Tasty Trade.
This is Kevin Worsh's first FOMC, his first press conference. Uh, I watched it I missed I don't know if he's still talking, but I missed some of it. Um,
interesting fellow. Um, spent part of his time here in in my fair city of PaloAlto, uh, at the Hoover Institute, uh, at Stanford. Um on the one hand he
and well credentialed you know Stanford MIT Harvard um don't know if MIT I saw in there somewhere but yeah Harvard Law Stanford undergrad um so sharp sharp
fella little slick defin definitely different style than Jerome Powell Jerome Powell was sort of this chap um whereas wor I feel like I'm being sold something he's he's a you know just a very tone, different style. Uh not
incompetent at all or inept. U but just uh yeah, a little smooth for me. Um his [clears throat] uh the initial reaction to the Fed's announcement of no change,
to the Fed's announcement of no change, but kind of a hawkish um he doesn't want forward guidance, but I guess whatever came in the guise of forward guidance uh made the market tumble. Uh he undid that right quick uh with his words. Um, but
we are red again, but just barely. The ENQ, actually the ENQ and the RTY are both green now. Uh, the ES is still a little bit down. Uh, for my own portfolio, good day. Very good day. Uh, yesterday was a nice day. Today's
another one. Um, just some really good results across the board. Um, no real screw-ups. Uh, so yeah, so far so good. Got some charts for you. So, let's dive in on this penultimate day of the week. And we
begin with the diamond, the D30 ETF, which had a intraday lifetime high. Uh, we're way into the 50,000s. Now, when I started trading it, you know, it was strange because like the Dow was like, you know, 1,500 or something like that.
I always marveled at the Nicay cuz, you know, the the the prices seem so preposterous, a high 48,000 and so forth. It seemed like just silly high numbers. Well, that's us now. Um, we've got a [clears throat] Dow way into the
50,000s and uh at the moment it's down a touch. We're above a broken trend line again. Um, I don't know. It's I there's opportunities out there. You
know, I'm in 30 35 different short positions now. Um, almost all of them profitable. Um, I'm tempted on this one. you know, just keeps kind of three days in a row of lifetime highs. Um, but yeah, it's
tempting. Got my eye on you, Mr. Diamond. Um, now here's a red bar we haven't seen in our lifetimes. SpaceX. Um, it's [clears throat] funny. I mentioned this to to uh Liz uh this morning that it it's it it's a little
nerve-wracking for me because after my show each day, they'll package it into a YouTube video and they'll slap a few words on it kind of like have some [clears throat] some poignant bullet to grab people's interest. And yesterday's,
calling the SpaceX top, which sounds kind of definitive. I was really nervous. See, we wake up to 250 on the SPCX. So far so good. We that that lifetime high has held which is about 228. I
include overnight trading because it's been very active overnight. Um [clears throat] but on a day basis, this is our first red bar. I imagine it'll close red. Um so yeah
um interesting [clears throat] stuff uh because it popped 50% in this first couple of days as a financial entity but now we're seeing some selling and have the digit one as the leading price quote. Um
here. Um like I say I think no serious selling is going to be permitted till August 11, but uh there are holders out there and they could still drive the there and they could still drive the price down. Uh the cubes. Uh very
at the moment. When I started the show, we were green. We're we're red across the board now. I'm I'm sort of annoyingly glancing at my screen over here cuz I u I want to be short Bitcoin, but I'm not. And it just keeps plunging.
So, when you and I say goodbye to one another, I'm going to scurry over and punch in some trades. Um but the cubes did something very cool today. Check this out. Look at this gap. Check that out. the low today almost exactly
sealing the price cap up. What do I want to see? Well, what does the perma bear want to see? Of course, I want to see it fail. Um, hasn't done so yet. So, that that support did hold even in the hardest selling. Um, and uh yeah, uh
it's got to break it for us to get some real action going. But, uh that's really real action going. But, uh that's really cool. I love those gaps. Crude oil is stable right now. um the excitement over the whatever you want to call victory or
use, the sessation of hostilities with Iran. Um you know, it's like, okay, and they're done that old news. Um and as I [clears throat] said yesterday, I I don't see crude hel heading to 10 bucks a barrel. You know, it's going to be in
this range for a long time because there's a lot of damage out there. Um, there's a lot of damage out there. Um, XOP, the ETF for U, energy companies, continues to sink. Beautiful right triangle pattern I pointed out a few
days ago. So far so good. It's it's gingerely moving lower. Um, I wish I had more energy exposure. I wish I was short Bitcoin as I just said, tell you the truth. But the uh I I've only got one energy short, which is Hallebertton. Um,
I had been short slumber. I covered it for no good reason. Shame on me. that's taking a real tumble today. Um, but yeah, XOP continues to to slip. Oh, here's SLP just a twist the knife a bit. Uh, down 4.4%
below that sort of head and shoulders top. Um, looks good. So, uh, [sighs] top. Um, looks good. So, uh, [sighs] yeah, energy assets in general, gold and energy stocks and and tech, everything's everything's slipping red.
Um, [clears throat] yeah, I like what I see. Yesterday was the beginning of of of kind of peak good news as I talked about. And um, now and for whatever
strange reason, the market seems to like to sell off after the federal chairman, whoever the person may be, walks away from the podium. Um, and it's [clears throat] happened again today. There was all this excitement about, oh,
look at him. Look, look at the stride he's taking, you know, up to the podium. And then after it's done, it's like sell everybody. I don't know why. Always seems to happen that way. Probably a pretty tradable reality for you. Um,
gold, and I'm going to pick on this a moment. I might have stumbled across a bug here. I'm not sure. Uh, gold is down hard, and I talked about yesterday being short gold, more specifically being long
short gold, more specifically being long gold puts. Um, it's not reflected here on a daily chart. If we change this to like a 30inut chart, it's very much reflected. So I think maybe a little little bug there engineering team uh on
on this futures quote. Um the daily data seems to not show this information. Um I don't know why but this one does. And so this is a 30-minute bar and we're seeing a nice wipe out there uh take place with gold as God intended. Um I'm sure also
gold as God intended. Um I'm sure also uh EQX um which is uh E equinox not the not the fitness company but the the the minor and there's a beautiful head and shoulders top on that and we're reversing away from that nicely too. I
to go down. Silver palladium silver miners you name it. Um over in this the wonderful world of semiconductors uh I'm still obsessed semiconductors uh I'm still obsessed with Nvidia. Um I'm short at this and I
think that it's going to be an important um bellweather for semiconductors in general. A lot of the high-f flyers like Micron and Applied Materials and um you
Micron and Applied Materials and um you know the storage companies WDC, STX, SNDK um they're just in La La Land. Nvidia seems to have a firm grasp of reality here. And [clears throat]
been getting a lot of press lately because of his revelation that OpenAI is losing even more money than originally revealed is just like billions just
blowing up and dumpster [snorts] fire. Um and uh people are like, you know, all the hyperscaling thing, all the AI thing starting to have their doubts and and they should. [clears throat] Um, and so Nvidia, I think, is kind of
recognizing that the other stuff is just feeding on itself. And, um, you know, [clears throat] a reader of mine said, "Hey, you should fundamentals are crazy. It's like, no, it just I'd love to, but it keeps going
up. Shorting something because it's insanely priced, unfortunately, isn't a great reason to short it from my perspective. I'm a chartist at heart. I need to see some kind of breakdown, some kind of reversal.
uh in recent days that I've tried to do such things like gosh WDC looks like you such things like gosh WDC looks like you know um a bamboo skewer as it looks ridiculous and then I lose on it just keeps going up. So when it
falls great will be the fall of it and all the others but it's uh you got to get the day right. Right. Um, here's SMH, which I've obviously bearish on, too. Um, this was the day I shot my mouth off about. You know, this is like,
you know, amazing opportunity to short it and worked out great as of yesterday. Today, we've recovered a portion of yesterday's drop. I don't think it'll last. I think something bigger is bigger is on the way. So, I've continued to uh
those are January puts I've got on that bad boy. Um, SNDK, I made mention of bad boy. Um, SNDK, I made mention of that, um, is up $18, but it too is teetering right at that trend line there. For the boulder among you, you
there. For the boulder among you, you might want to short it. Um, it's it's um, yeah, I'm not, but it's uh, it's crazy expensive. Uh, speaking of Stanford University, one company born there was Snap, Evan Spiegel. Um, you
introduced uh their new product yesterday, Specs, S Ps. Good heavens, they're ugly. Um, the the reaction was not great. Um, the the high
yesterday was in the midst of the announcement. They're basically uh augmented reality sunglasses and um [clears throat] and um [clears throat] yeah, yuck. U not not not an attractive
accessory choice. Uh, I think it's going to bomb. I think it's just going to because Apple, which did a superb job with the Vision Pro, that was a bomb. Um, but this one is going to be um I don't think it's going to do well at
all. I think the market recognizes that. Um, they've been trying to save, you know, cuz in the midst of social media companies just becoming worth trillions. Snap's been like so yesterday's news for so many years. All they do is go down.
around. I think at one point they renamed it um camera. I think they did or either intended to rename the company camera. Um that didn't happen. But uh
yeah um I do not think this is a turnaround story. Uh I think [clears throat] this pattern here will not produce much different results than not produce much different results than say this one did like so
uh the only difference being zero is a lot closer in terms of support. Uh some other shorts I got cooking. This one's in a surprise how good it is. Intercontinental Exchange ICE. This is a big big big brokerage. Look at this
beauty. Oh my goodness. Is this magnificent? Look at that. Good heavens. say anything else. That is a gorgeous chart. Yay. Uh Microsoft I made mention
themselves for sucking so much uh in this in this bit everything up market. And I said yesterday, um, anything that can be behave like this in this absurd market of ours deserves to go down forever. They must be so broken. They
talking about. Oh my goodness gracious. What a dog in a bad sense. Uh, Spot is What a dog in a bad sense. Uh, Spot is Spotify. They're also sinking.
all. These are just some I wanted to highlight. Here's Donkey Kong, DKNG, highlight. Here's Donkey Kong, DKNG, DraftKings. Um the magical changing pattern. Okay, we're just going to go to point on that one. Um but this one is
point on that one. Um but this one is also down nicely over 6%. And this sucker, we could probably drag him down like so. So these are all working really like so. So these are all working really well. [snorts] Yay. Uh Google, I shorted
this one. And as big as it is, this is not something I've really I've either hardly ever traded or never traded. It is just like usually really boring. But I shorted this yesterday and so far so good. We're down um [clears throat]
almost 3% on that. So that's working out. This Bitcoin is killing me, man. My my trading fingers are itchy. Meta, which I have nothing but disdain for. I
shorted this yesterday again. Um down uh about 4 and a half%. And I think long term they're in dreadful dreadful trouble thanks to the leadership of uh you know Alexander Wang and the uh their acquisition of the his organization.
So yeah, heading lower and oh my goodness, my favorite the chart of the day. I showed this this morning. Carvana, I'm just in love with this. I mean it's it's almost so obvious that I'm I feel awkward cuz I expect it to
announcement. It's just I'm trying not to shoot my mouth off about it because it just seems too easy. It seems too obvious, but I am nuts about this chart. Carbon. Yay. Um, Bitcoin continues to plummet. Oh,
here's Bitcoin. Um, we are down quadruple digits on this. I talked about maybe a rally to 70 71,000. We may have to endure that. This may be it. It may have exhausted itself two days ago. So, um, that could be exciting. So, this is
our new resistance, that line right there. And there. And one last sneaky one strategy MSTR down one last sneaky one strategy MSTR down for obvious reasons also. So, anyway,
I'm going to go short some more Bitcoin now. Um, I hope you're having a good day. Um, congratulations [clears throat] to Mr. Worsh for his first press adroitly. Uh, and I will see you tomorrow during the last trading day of
tomorrow during the last trading day of this week. So, see you tomorrow morning actually and also tomorrow afternoon. So, take care. Bye-bye.
When you are assigned, you are ultimately short an option that's in the money and the counterparty has the ability to exercise that option. So if you are assigned, it means your option against your will ultimately has turned
into 100 shares of long or short stock. What does a green scratch mean? Ooh, a green scratch refers to stubbornness getting the best of you. And when I say you, I mean me. Uh, green scratch refers to rolling a position, defending a
position, and instead of just closing it for less than uh loss that you're seeing, or maybe a $100 loss, $50 loss, a green scratch is when you close it for maybe a 5-cent win, 10-cent winner, 15-cent winner. [music] Just the ability
to see that green number on your screen and get out in a profitable way as and get out in a profitable way as opposed to a loss.
for options trading. Period. Investors Business Daily raves about us. With stockbrokers.com, we're number one for options trading and best-in-class for futures, too. The Mly Pool really likes us and so does broker chooser. So,
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>> Hey, bring the alarm, boys. Turn up the charm. Listen up, y'all. Get out the damn song. It's the last call. Hey, the last call. The last call. The last call.
final 30 minutes of the trading day. You're watching Last Call on Tasty Live. I'm your host, Chris Veio. He's Jamal Chandler in the co-pilot seat here. And we are arriving as markets go into session lows. Jamal, we can go right to
the charts. Laura, uh NASDAQ 30,78 down 8/10 of a percent. The S&P 500 off 1.3% the end of last week. We closed last week at 74.98. We are now closing that
week at 74.98. We are now closing that gap here off 1.3%. Dow Jones off 1%. The Russell off 8/10en of a percent. Bonds notes, they're seeing a little bit of weakness here getting rejected again at key levels that have been keeping us
several weeks right now. The 50-day moving average rejected here once more, down. Surely that's bad news for gold, which indeed it is. Down 2.4% here as trading session. Volatility is up. Gold's off 150 bucks from its high right
before the Fed meeting. Uh volatility is up here. Jamal VIX now in at 1837. A lot's changed since I got off air with TP just uh just about an hour ago. >> A lot has changed. And you know what? There's a task force for that. That is
definitely the word of the day. Oh my goodness. Can we just talk about how interesting that was? It's very fascinating. I I want to get I mean look I I watch these things but I I I defer to you when it comes to takeaways from
from what Kevin Worsh said. What are your takeaways on this thing? >> Uh obviously it wasn't as polished a press conference as we're used to but I Powell's early press conferences. He was not the same kind of public speaker in
that particular context as he was towards the end of his term. So a little you know people said he was a little stiff. Okay. It's his first time doing this. He cut the guy a slack in some regard. But also, um, inflation task
force, Jamal, isn't the fy [clears throat] the inflation task thought. >> Is it their job to do that stuff? >> That's what I thought. Yeah. You the task force or the task force, I
>> I suppose it's always good when the people who are charged with controlling inflation have to bring in uh, you know, the consultants, >> right? to figure it out. >> Yeah, it's a trip, man. Look, uh what
I've been have obviously had my eyes glued to is the spoos. You know, kind of different person, we're seeing something that we've seen plenty of times before. The uh markets are sort of teetering there and then as the statement is being
meeting is over, we see a little release here. So, I I don't necessarily know if this is um as a result of of the somewhat hawkish tone today. Speaking of, it's starting to seem like we might be uh pricing in probably about two cuts
at this point. Again, this is all so quickly. This is just right after the shake out. I don't know how much this move means. Currently, the S&P 500 E- Minis are down uh 91 points below that 7500 handle. So, um we were just at 76
7,500. This is not a huge drop by any stretch of the imagination. As a matter of fact, S&Ps are taking it more on the chin than the NASDAQ is. So techs aren't exactly bearing the brunt of this selling. I'll
tell you that. I mean, hell, I'm looking at Indel. Intel is up $4. Uh so so is and Marll's higher than it was earlier this morning. So it's not the semis, it's just the other stuff. Um I I would say and uh again, this is also an
interesting day in that we had a VIX futures expiration. June VIX expired today. So, it's just kind of uh and this happens on on Fed meetings at times. Wednesdays, we have some Wednesdays where where both happen. So, I I think
it's a little bit of that honestly, Chris, where we're seeing these moves. Um but, you know, the one thing that that definitely stands out is the say, and that's what's causing gold and silver to falter.
session. That US dollar right now, we have to go to a 12-h hour chart because we're approaching the highest level that we've seen since March right now. Dollar Jamal, before we get into the FX of it all, you mentioned something about the
stock market. It's down 1.23% here. Not so surprising. How often is it the case that we get the S&P 500 down more than 1%, 1% or more on a pharmacy meeting day? Uh I did a little scan here going back um to 2010, 15 years I feel like,
you know, let's just say nothing in 2010. So 2011 is when this starts. There 2010. So 2011 is when this starts. There are 15 occurrences since the March 15th, 2011 FOMOs meeting that have produced a sell-off in the S&P 500 of 1% or
greater. My question is what happens next? Obviously in this observation u typically across those 15 instances, so not quite a great sample size, right? NA significant sample size, but almost there. The average for the VIX on those
days, the VIX closed on those days, an average of 24.08. average of 24.08. Okay, the what return the next day, the Okay, the what return the next day, the next day average return was0.48%.
For the S&P 500. So, tomorrow's Thursday, right? We're not going to get the Monday close would be negative 0.56%. A 3-day forward return is negative0.68%.
But one week later, by this time next week, right by the close on next again, what happens when the S&P falls by 1% or more on the day of a Fed meeting. Since 2010, the oneweek forward return has averaged plus 0.21%.
So, there is a little bit of a shake out and a shock here today. Maybe it days, especially if volatility goes up. But if the VIX hangs out and stays below 1920 or so during whatever little correction we're going through here,
>> it's probably going to be something that you want to fade. >> Fade. Fade the volatility spike. Fade the move lower in stocks. Not this week, >> I was about to say, I'm literally executing on the idea that you're
talking about? Fade. No, I I agree with you. I am fading the idea as far as calendars. I'm glad you said that. I'm doing I just did one I did this I'm doing another one now. That one obviously is not going to work. That was
actually short the Fed long tomorrow. Now I'm going short tomorrow, long uh Monday to to your point of of the data you just gave out. Doing the $7,600 uh calendar spread. $6 is a little chunky, but it is S&P. Sometimes they're a
>> They can be a little chunky. We have a lot of negative market breath coming down the pipeline here according to our man behind the screen, Frank. Uh, in terms of that breath, 70 stocks in the S&P 500 are higher right now, 428 or
lower. Not great. 22 million options traded in SPY, S&P, Triple Q's, and IWM with 3 million Tesla and almost three million Nvidia. Mags are taking it >> Well, Matt is the one that's getting
mean, they were kind of getting beat up before this. I don't I believe I mean, I they just went lower into the meeting but they were already down today Microsoft or Meta specifically >> they were I mean this is the 9:30 open
for Meta 596 we get to the Fed meeting here the statements released 580 we get to the press conference >> it's trading what 575 market and again these not only are these NASDAQ socks but they are in the
S&P as well I think it's interesting I mean it looks like the NASDAQ might be catching up a little but the SPO is bearing the brunt selling here. >> 30,000 NASDAQ went through like a hot knife, Frank. So, can't agree. Sure did.
Yeah, it did. I just Yep, it's true. >> And, you know, this raises this raises a because I'm watching this 4hour close, I want to see this close above 30K today put on last week before the market rallied. Um, if we get a close down
going to be partial to just taking them off the table. Jamal, I really don't >> I really don't like the fact that we're seeing some of these key levels that have been both support and resistance. You can just draw a line on the chart.
Resistance, support, support, resistance, resistance, resistance. >> There should be support. >> It should be, but uh I mean I these are often, you know. I mean, you're already in it. I mean, for those who don't have
any, like I I definitely could use a short put spread or two listen, it's not going to be as big of a gain, but just it's at 23 days to start breaking the key technical level, what am I going to really do? Ride this
out for 2 days when we see that the return profile of the market is to the You know, once the S&P 500 falls by more than 1% on a Fed meeting day, I'll just get another shot. Take a shot at the 50-day moving average. That sounds good.
50-day moving average. That sounds good. Jamal, um the uh one weekek win rate though, and that's what makes this so interesting. The win rate at 3 days, the market's up 53% of the time. It's just when it's down, it's down a lot more.
The win rate at one week is only up 47% of the time, even though it produces a could be a little bit of a blender here if history's any guide. Um I did see a note coming in. What's the average loss of this when the S&P is more than a 1%
loss? Uh what's its average loss in those days? 1.73% since 2010. So those days? 1.73% since 2010. So NASDAQ's down 1.2, S&P's off 1.45. >> Yeah, I uh man, I'm I'm just watching things happen here. I'm doing a couple
rethink a little bit, too. I mean, I ended up selling upside actually the the call spread in in the S&P 500. Although I did buy a what is that 2-day 5day S&P?
I did buy a what is that 2-day 5day S&P? I bought the 2day, sorry, one day, 5-day S&P calendar for the 7600, but then I went out to July and I sold the 7600 7610 call spread. So, I just think trying to take a little bit of advantage
here, whether it's and again, I'm I'm selling the upside in that situation So, at some point, I do have to sell some upside um as a result of that. If we get another, you know, one and a half percent down over the next day or two,
look at selling more downside. We'll see. >> In terms of the sector performance here today, Jamal, uh, we track 29 sector ETFs here, at least in my watch list. I only see two in the green. Not great,
Bob. SMH, IBB. Does it surprise you that SMH is holding up in this tape? I know the leader. >> That's what I was That's what I was names I'm looking at in my portfolio. I got Intel, I got Marll, I got AMD. Those
things are positive. So, yeah, it's it's uh it's it's holding up. Um like I was sorry, NASDAQ are catching up a little bit to SPO here. SPO is down 1.4% versus NASDAQ down 1.1, but these names are showing some resiliency here. What about
SanDisk? SanDisk is negative. That is a name that has been positive no matter what. That thing is negative today. Just a little bit though, barely. apparently I said don't win rate which the production team is having a lot of
>> Yeah, you almost sounded Chicago like I mean don't you don't want to do that. still revel in your New Yorkery. >> Some I saw someone wearing a Nick shirt daughter at school and I said I went, "Yeah, baby Nicks." This guy came up to
me, just gave me I've like never seen this guy before. [laughter] now, man. >> Kevin Worsh harshing the vibe. What are >> Yeah. >> What are you doing?
>> I'm uh you know, actually, I'll send you the video. Uh, so Mitch Robinson lives the video. Uh, so Mitch Robinson lives in my town, right? He has now this gigantic white and orange monster truck that he's just been driving around town
loops. >> Wait, what? He's a country music guy. >> Oh my gosh. I'll send you the video. So is Mike Brown, right? >> Yeah. Oh, Mitch Robinson is a big He lives across the street from uh some
from some from from friends of mine and he like shows up at one o'clock in the morning with like his neon lights on his monster truck just flashing and music >> I'm sure nobody's saying anything right now. I mean, the Kings of the City, man.
he he on the you know what on like Saturdays he like goes to the park and shoots basketball with with like the kids and like attends the practices and >> I bet the kids make more shots than he does. That that dude can't shoot at all.
You should see him shoot. It has this beautiful arc. We're like, where is this in the games? [laughter] >> Is he really one of those dudes? Because there are dudes like that, right? Like there's dudes that like, yo, why why
this a lot when I was in when I was uh especially out of D1 school. So, when I deal. I used to notice that, man. Some dudes who sat at the bench weren't out there and you're playing with them one-on-one. I mean, like when you're
damn, this dude seemed like he could be in the NBA. What's going on with this? >> In this case, this guy's actually in the NBA. [laughter] in the NBA. [clears throat] Looks like we got a little stop here
of what was that? What did we bounce off of? Uh >> 472. >> 7472 here in the S&P. Getting a little bit of a lift, which, you know, not the most surprising area where we've seen
it funny how these things work out. People tell me technicals aren't real. Jamal, when we were looking at the MEES position last week, like why did we hold inverse head and shoulders pattern coming together here. We hit the
literally the extension target. That's where the market paused and then we've breakout point. We're right around 7465. If you like the market last week at 7465, you probably love it here today, as the saying goes. Um,
>> The NASDAQ isn't really breaking down substantially, though. I'm I'm very do cover the gap from the market close on Friday, which was again 29,967. The low for today is 29,931. and we immediately start lifting off there.
all we needed to do is ring out some of the enthusiasm for the start of this week and then we kind of just pick up the pieces. So, I'm I'm more interested adjustments now as this session winds down until its final 15 minutes. I don't
think I'm going to do anything probably until the futures market reopens. Maybe to clean up the book. But if we hold here, >> we've been through worse. We've been through worse than a little% dry down.
>> We We've been through worse for sure. Um it it does all make me think some of this today makes me think about whether or not it's um you know, I think there's little things that are happening that I'm I'm paying attention to and being
observant about the market. Uh we had a piece this morning, research piece that Sahil did about utilities. Now, utilities are never sexy and not really utilities are something that's not really paying being paid attention to in
lot of tech stocks. So, you know, there's that. There's um there's consumer staples. I think we've talked about this a good bit uh every now and again over the last couple of weeks. And I have a Walmart put that I'm short. And
I have a Costco calendar that um I have on as well, the 1100. It's a SE versus short August. So, you know, those type of things. is this time in the beginning what's going on with the dollar here. We're seeing a market that might be
looking at rate hikes at some point and that stuff might be coming in vogue a to get a little bit of exposure in those areas might be worthwhile. the Walmart. I think that was a confirm and send trade, right? I forget, but we
>> No, it was me. I I was thinking about it. I think it was after earnings or decided to sell a put and I told you about it the next day and I think then >> Right. So I'm I'm in the 110 115 here and just thinking about this trade
management now a few weeks ago and this has been on for I don't know like two >> I want to just go back to the lows that we have here. This is a really important trend line to me. Maybe it's important to you too listener at home because it's
from the lows that we have in uh April 2025. We have the lows here in November 25 and we have the sell-off lows at the end of May. So this is a pretty sturdy uptrend. We likewise have a meaningful swing
level that was start carved out in the middle of March. And so you can see why here at like 115 120 or so. We really got to stick, but we're not sticking. We just had this counter trend bounce and then we struggled against the one month.
now we're killing over and the rate of change is increasing to the downside. aggressive negative rate of change today than it did yesterday. As does the one looking at this and I know there's still 65 days to expiration. I do not like
this particular position here at the 110 115. I'm just going to get this off the book. I don't want this. I hate this. In fact, gone. >> I feel it's unsatable.
>> It's just not, you know, when we're s sitting on support like this, I just bucks. See you later. >> Yeah, I'm not that worried about Walmart in that way. Um I'm really not. That's why I I'm I'm keeping it.
>> Mine is in August, too, though. Where's yours? Yours you're you did July, right? Okay, fair. >> Don't want to deal with it. Jamal, I'm some things today because we are getting some breaks here right now. CRM had this
breaking out higher. It never quite could get through those swing lows. It crashed back down and we're now setting new lows. I was here with a short put spread that has now gone negative. I don't want this thing junk. 30 days to
for a bounce before the end of next week. I I suppose I could, but we're getting close to 21 DTE. I just don't want it. So, not going to catch a different when we started to break out. Now that we've broken back down, get rid
of it. No thank you. >> I hear you. I hear you. That's You got again. Sometimes you got to do it. What do you these aren't like the sexiest things right now. Not a lot of people, if we do
the content. >> Um, but that's a function of where we are in the cycle perhaps. >> Decent bounce off the lows, maybe a 10% bounce that it's already started to fade off. Do you try to catch this knife or
way through the system still? >> Um, you can do both. You can try to working its way through the system. It just depends on how long you give yourself in duration for a position. So for me, it's been an IBIT. I've had um I
have a couple positions on in here, but um I am short a put uh in one fashion. I'm actually short a couple. I'm short one in August. I have a short put long call spread to the upside afterwards. And um that's in August. Short 35 put
long the 40 calls just in case this thing starts to be loved again. But that's in August. That's a while out. also have um a short put that's in the money and I did this when it was trading 35 so that's why I sold the 38 strike
that's in to the July 31st cycle so you know these are ways that you can keep that keep that have that exposure you can also eventually roll these things out over time I think this is a very liquid name I bit is the way to do it
>> sure you know if we do get another breakdown here if we start to see those out the lows that we had just two weeks ago cleared out near 59,000 I think 50k becomes a magnet. This is a weekly charter. Jan 24, we basically get
to 50k. We pull back. Once we break through, we never quite get down through through, we never quite get down through there. August 2024 selloff. I'm thinking market's going to seek it's going to seek it out very quickly if we start to
break through 60. But at 50k, Javal, I mean, you're telling me that that that we can buy back in Bitcoin at 50k? That's that's that's a really know there's we've had a lot of smart people on that have said Bitcoin can go
channel on a trending trades interview a few weeks back, but I would have to number, you're going to get at least a dead cat bounce something for like a day or two >> that pulls you back up. So I I I think
little bit of a contrarian despite the crypto winter continuing to rage. go further out and do it. These are It doesn't it it's not fun if it's short to put and it continues to fall further
you can roll further out. I didn't used to do that a whole lot. That's something that uh we've we've obviously had a lot of research on. We preached a lot. out of of trader Mikey Bee's book. I mean, Mikey's good at kind of holding on
not really worry about it because again, it it's um it sure it's affecting your but as long as you have the ability to hold on to that, that's then that's a position. I mean, if you can't, then understandably, you got to buy it back
understandably, you got to buy it back at some point. But again, I mean, these period? You know, it's just like they're talking about like the piece I just did about Micron and 1500. Yeah. Over what time period? When is that going to
week? Are you calling for it in the day? You know, there's always these these these call outs for these levels. So there's, you know, the the options math doesn't necessarily support that, for example, in Micron. But it's also has to
be a situation where they come up with some crazy idea around earnings and and further. That's not what options are predicting right now. Options are only predicting like a 5% 15%, excuse me, move on earnings, which are next week at
Bitcoin. I don't know if Bitcoin is going to 10,000, but it's easier to digestible product versus trying to buy Bitcoin and holding on through that. That's a lot more expensive. I think IBIT is just an easier product to do
very liquid. So, you know, again, you have the ability to continue to roll out, roll up, however you need to do it just to keep yourself in the game. you just made about, you know, what's your time horizon? If I told you that
your time horizon? If I told you that the S&P 500 was going to hit 10,000, from here." And I said, "Yeah, but it's going to do so in four years." You go, "Okay, well that's uh that's only 8% a year for the next four years."
>> It's like a huge claim. If I said S&P is going to hit 10,000 in December, you'd go, "Oh, that's 36% higher just this year alone. That's a totally different set of circumstances." So, yeah, the Micron stuff that s these have been
Digital yesterday was holding up too. I thought that was noteworthy, right? You jiggling around in SanDisk, but when you went to like Seagate or Western Digital, those are some of the leaders that we have right now. If you look to SMH
think that there was much. You'd think maybe today was a little bit of a maybe you could see the candle, we gap open higher, we fade off. But I don't think you'd think it was apocalyptic until 70s break. mall, you can't get
apocalyptic on the NASDAQ because it means the AI infrastructure component of this market is still very much in place. Before I get your response, because I do after all. We got to go to refer a friend. This has been waiting in the
hopper for about 10 minutes. I've always been reminded here. Uh, yes, refer a friend. $100 for you, $100 for the refer referral. Either way, bring a friend Tasty.com/refer a friend. Jamal, um, I've tried this as
well. I told Ilia he's not a friend and then he's actually now a friend again. So, we're trying to work the system. They're not letting us game it. >> Yeah, understandable. I guess I do want to talk SpaceX options. Um,
to talk SpaceX options. Um, >> we need to It does seem fall is coming in in there a little bit. Uh, you know, I have these calendar spreads on SE versus August and both months are kind of coming in. I think the SE is coming
is coming in a little bit more in the set, but they're both kind of coming in. bit of a normalization, if you will, around a very liquid options product as it is. >> These are probably the most uh you know,
tradable things right now in the market outside of what S&P ES there's so much volume in here right now. I mean, it's not quite the day yesterday, but 190 million S&P traded here. I I keep going back to like Meta,
for example, 15.4. >> Yeah. and nobody >> or Nvidia 96. So I mean the SpaceX has already eclipsed Nvidia's trading There was again for yesterday too this company Vander Research has been putting
out this rolling note. Uh SpaceX volume through its first three trading days was equal to all of their trading volume in the rest of the market for single stocks the rest of the market for single stocks which is absolutely wild wild. Uh hey,
we're getting some notes here from the Iranian Iranian uh agreement that we have. J man, >> should we go through it? >> Can you give me the cliff notes?
>> Yes. US pledges uh no new sanctions on Iran, no additional military deployments in the region during talks. Iran to maintain Here are the good things that the market probably cares about, though. US2
blockade of Iran. full removal targeted within 30 days. Commercial shipping immediately and return to pre-war levels as soon as possible. Uh Iran to ensure safe passes of commercial shipping between the Persian
Gulf and Gulf of Oman. Transit of commercial ships to be free or fees for commercial ships to be free or fees for an initial 60-day period. So fees would don't know if the market's going to care that much if Iran collects a dollar a
barrel of oil. You know, a VLCC carries 2 million barrels of oil. And so at $70 a barrel, we're talking about what? A load that's $145 million of oil on one
of these given tankers. And you're going to have to pay $2 million insurance additional on top of that right now, a 1 and a.5% fee. People aren't going to like it. No one's going to like doing that.
But it's not backbreaking. >> I don't think that's going to be hugely them getting $300 billion? Did I hear something like that? something like that? >> Yes. Listen, Mayor Kulpa, I I may have
sent out a a graphic yesterday to the team. Just I just want to kind of troll but I included the list of the world's richest men on it. And Elon Musk like, "Wow, look how wealthy Elon Musk has got.$1.2 billion." $1.2 trillion. And it
got.$1.2 billion." $1.2 trillion. And it was like industry, US tech. And then the second richest man was the new Ayatollah and it was $300 billion and the and it was $300 billion and the attribution was US taxpayers. So I think
>> yeah right. >> Uh jokes aside um no it's not it this it would be $300 billion of taxpayer money. Right. Facts matter here. It
would be a $300 billion joint investment vehicle that's chipped into by a lot of states in actors in the area. That could be a Saudi Arabia, an Oman, an India, a Pakistan, right? That assuming conditions are met by Iran, then
investments would be made into the infrastructure, which I know there's a lot of doubt out around there about this. There should be, right? Money's funible. If Iran had like say $5 billion that they were going to allocate to say
Hamas or Hezbollah and we just give them $5 billion, they go, "Yeah, we're going to use this $5 billion for for infrastructure, right? But money's And now the money that they kept internally, it's going to be a master
ball. Ilia knows more about this than I do. S&P 500 7494. You get a bounce here session. Volatility is up down 1.2%. So it is a 1% down day. Jamal, NASDAQ here
though pokes its head above 30K. Looks like I'm still in the game with the one more session. We'll see what happens next. But I know someone who's going to be very happy about all of this. >> Oh yeah. And that makes both of us
deeply upset. We'll see you all in 90 seconds.
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17th, 2026. This is overtime. I'm your host, Chris Becky in New York. He's take you through the next 30 minutes as we wind down this trading session. A trading session defined by Kevin Worsh's first meeting as Fed chair cut the guy
as Powell. Of course not. Powell had years of giving speeches at the podium tenor and cadence that we all came to know and love on the purple tie time to
buy days. War sound did pretty good all things considered. Ill right. He's a little stiff, a little academic, but that's that's not really what matters here. You can't you can't fault somebody for their first outing at that podium
for sounding a little stiff and a little academic, especially when there's so much ambition behind what he's looking to do. There was a lot to do. The thing was very ambitious in terms of what he's proposing
and frankly Powell was a little rusty at frankly Powell was a little rusty at first at the podium having been governor for consecutive years before he took the job. Worsh has been away from the Fed
job. Worsh has been away from the Fed for a while. So he did fine. He did here. S&P 500 down 85 points. The Nasdaq, it trims its losses. It's only down by 8/10en of a percent now. Uh, the Dow Jones up by 9/10 of a percent. The
Russell off by 0.6%. Can you tell that I've had a few Celsius today, Ilia? Notes here are down by 610 of a percent. That's 21 and a half ticks. 109 and 9 ticks here. Bonds a little bit more insulated, which is interesting. They're
only down about 12 ticks as it were, 3/10en of a percent. But gold really of this Fed meeting. It was trading near $4,400 at the time that the Fed meeting, at least the initial summary of economic projections, came out. It drops about
150 bucks from high to low. It's now back to 4261 here. Uh with you on our little Fed coverage there, I did get into that >> turns out working out pretty nicely
keep that going. But today's about the dollar, too. And I know that you're a this a little bit earlier when we were talking about this on last call. It's just a plain good day for the green back sitting up near multi-month range highs
now which although the open outcry close won't give us the full scope of that rally. We're still in here at like what 1060 range that we've been trading in since last late May early June actually right
year. >> The dollar turning the corner here can't be ignored as a result of what the Fed's trying to accomplish. trying to accomplish. >> No. And I think that's part of how you
arrive at the unambiguously hawkish readout that the markets have for this readout that the markets have for this Fed announcement. Worsh and all. See Fed announcement. Worsh and all. See what I did there? Um what this I think
clearly says [snorts] whether you look at uh Oh, >> I just saw like the just the most ridiculous Trump comment ever. He was being able to to like well they retain
goes, "Well, it'd be a little bit unfair for Iran to have no ballistic missiles if the other countries in the region do." What? We just want an offramp, baby. Come on. Let me out of this thing. >> She's just [laughter] I just want to go
home. Of all the calls I've made recently, by the way, noting several this war." That was but my best one. >> It's [clears throat] a good one. It's a good one. be [laughter] go ahead and take a little dirt off your
shoulder on that one. That was spot on. Um I think you look at this today. >> Why do we go to Why do we go to war with a run? I I don't mean to interrupt you. >> I listen, it's a it's a it's a complicated thing. Lots of ins, lots of
outs, lots of what have you. As uh one Jeffrey Labowski famously explained, Jeffrey Labowski famously explained, it's a complicated case. >> But but when you look at but when you look at what's going on here, I mean,
what's the one thing Kevin War said 90 times in this uh whole outing? times in this uh whole outing? He was asked every which way,
won't you please give us something to to to hold some kind of something to not short statement, no forward guidance. And he kept saying that there's a task
force for this and a task force for that which very management consultant of him. But I think the most interesting thing is the one thing he kept repeating was is the one thing he kept repeating was it's time to get inflation to target and
we're not going to have a new way to measure the target until the end of the year. Now, okay, if the inflation task force is going to come back with a redefinition of how we get to measuring
redefinition of how we get to measuring 2% and it's some sort of new Worsh approved metric that runs cooler than current benchmark, we're not going to get there until end of the year on his timeline to know what that is. And in
the meantime, we're targeting a 2% PCE bogey and he's pounding the table saying we're going to hit this 2%. Come hell or high water. Okay.
Then we look at the dot plot and we go, well, they want hikes. Then we look at the market and we go, they've priced in two of them. So, okay, unambiguous. Worsh did not contradict the hawkishness of his colleagues. In fact, he came out
and basically said, "Yeah, me too. I'm just not in the dot plot because I have um shall we say faithbased um restrictions."
That's funny that he's >> conscientious objector to the SCP. >> What a what a Yeah. Well, I mean, he he had a really interesting comment here. markets perform best when they react to incoming data. I think the financial
ask a question. And how will the Federal Reserve react to that incoming >> That there's going to be anything different ever and that there has ever thinking. Uh because of course the markets are as ever forward-looking. Any
market participant knows it doesn't matter what an earnings announcement is. announcement expectation is and what the outcome is relative to that and how the
outcome is relative to that and how the markets then rebase expectations. U so a lock >> pretty aggressive. >> This is a pretty aggressive rebasing of expectations today. The S3 Z6 contracts
earlier and you and I have gone through this before Ilia, but right hand axis subtract it from 100. You're going to get your implied Fed funds rate effectively at that particular juncture. You could do this with the ZQ contracts
on Trading View, for example. they're no longer listed here on the platform. But uh the point being is we went from 9610 to 95.90 here in the very short blink of an eye during today's session. So we go from being between 3.75 and 4% by the
end of the year to the market now saying >> for the first time all year by the way that we're going to have a rate between four and 4.25%. And so when you think about the expectations for where the hikes have
moved, this reflection makes a good deal of sense. Um, this is a price again of sense. Um, this is a price again around a little bit more than one hike. And so in terms of what that looks like visually for the CME Fed Watch tool, I
because it just adds everything up across the board for us. We don't need to do that ridiculous math. The next hike is now for September. We went from like a 70% chance of a hike in December prior
to this meeting to now 100% it's happening. There's actually a 58% chance that we're going to have to that will be the second hike we get this year. In 3 hike. So why does this matter? There was a
point earlier today when the market was reacting where we hadn't seen that shift in the curve >> where the market was saying, okay, yeah, >> Yeah. >> Now it's like, okay, the hikes could be
three months away. And so all of the sudden, right, I'm trying to work through this myself. Was this a June 2021 meeting or was this equivalent to what the Fed did in December of 2021 where they have
laid the groundwork in their SCP and have effectively said by the next summary of economic projections, we will be hiking rates because that's what they >> they did that in December 21. We get the pharmacy minutes in January 22. The S&P
pharmacy minutes in January 22. The S&P 500 peaks, the Fed hikes in March 2022. >> Yeah. I mean, I think it's really important to understand that if there is
important to understand that if there is anything that Worsh did today, and it he made sure to leave a lot of ambiguity, but if there was anything he did for sure, it was to create this sense that
this is a new day. This is a different Fed. It's going to operate different. He didn't even commit to having a press conference at the next meeting. He said, "We're going to have a press
conference uh when there's something to say." And this time we felt there was he's probably going to keep doing press conferences until the end of the year cuz that's when his uh task forces are supposed to give him communication
strategy updates. So, okay, we're going to keep getting this for now." But the message is clear. This is a different Fed. So we can't necessarily say that the way that there was continuity between Bernani to Yellen, not in
thinking about policy, but in how policy is communicated. All of the changes were made with a scalpel. Small iterations. And every Fed chair
has made changes. So has Powell, but incremental changes, small changes. There was continuity and an emphasis on continuity. What we have here from Walsh is an emphasis on discontinuity
and on changing the way things work. So, is this like 2021 this way or that way? Who knows? Ilia, while the market was selling off, I decided to do a quick
scan and go since the global financial crisis because I I I'm starting to throw away data that's pre GFC, the regulations, the market structure, like >> Yes, >> that is. So anyway, I I usually do this
crisis. Uh since the global financial crisis, crisis, really since 2010, right? Uh there have been 15 occurrences in which we've had the S&P 500 fall by more than 1% on a
the S&P 500 fall by more than 1% on a fomsy day. Uh usually the average close fomsy day. Uh usually the average close for the VIX on those days is 24.08. The average return for those fomsy days is minus 1.73%. So today goes into the
bucket, it's going to be minus 1.25 25 or so. The average next day return, two-day return, 3-day return in those 15 occurrences, all negative. Modest, but all negative still. So, the market sells off by half a percent the next day. It
next day, bleeds out a little bit more the next day. A week later, it turns modestly positive. How does this all work out? Next day, 60% of the time, it's lower to a tune of 0.48%. two days later,
3 days later, h so it becomes a bit of a of a coin flip as you move out in time, maybe the market stabilizes. But for the short-term path here, if this is your
typical next day after the Fed, people who are long stocks and short put spreads or something or short puts, you may want to reconsider, may want to looks like. And so for me, IA, I am thinking about what that looks like
because I have short put spreads on in the NASDAQ visa via a bunch of little short put spreads I've started to sprinkle in through MNQ. I like to build into the position and NQ is a big product, but doing things through MNQ,
it you can build up towards that full contract. So I'm thinking like at 23 days to expiration right now, if we break below 30 tomorrow, I'm going to have to take this off at a small loss even though the short strikes won't be
hit because they're all sitting below the 50-day moving average. If this thing I don't want to ride this out for another thousand points or so, I'll take it off. I'll wait to see if we get back down towards 29K and we could figure out
what we'll do around there. But this is the knife's edge. It's not fantastic guide. If you're a bull here moving if you have something profitable and you're sitting at 21 22 days to
to hold it. There's no reason to wait until after Junth. Yeah, I mean I think you look at this and you say, "Okay, well the markets clearly are telling you what they think about this." So number one, they're
telling you that they care. And that's a very important kind of first consideration is if you thought that monetary policy didn't matter, well, think that over again because clearly the market does care.
the market does care. The second thing here is that you're looking at a situation where you're doing some technical damage. You haven't done big technical damage yet. You're kind of testing the bounds and you're
testing them across assets. Some of the initial spikes have fizzled in gold, in initial spikes have fizzled in gold, in the dollar, not because the moves have we're we're digesting and we're hitting big levels. So, there's going to be some
big levels. So, there's going to be some back and forth here, but there has been a sea change. If the question was, how do you reconcile promises to the White House that were doubbish
with a hawkish committee and an inflation problem that seems to be seeping into core? We learned today how you do it. You give the White House a six-month timeline in which you say, "Oh, well, I
timeline in which you say, "Oh, well, I got a task force for that. But in the meantime, because that's the message that reporters got today is what the White House is going to get." Oh, don't worry, Mr. President. We got a
task force for that. But in the meantime, >> We got a task force, baby. >> Ilia, isn't the FOMC the country's task force for the country? Like isn't there rem to
>> it? Is [sighs] the task force needs five more task forces because there's tasks and they need forces. Now, it's funny because the next object of speculation here is going to be who's on the task,
here is going to be who's on the task, the forces. If uh if Worsh thinks that markets not to speculate about the inner workings of the Fed, well, there's a bridge in space. I have to sell him because the next trades under SPCs who's
on these task forces and what's their bias? Are they hawkish? Are they doubish? What do they think? >> Um I have uh there's a group out there called um ITC Markets that puts out a little scale of the hawk dove.
this out there, but this is one that I like to keep track of. Uh where does based on the >> very hawkish. one of the little wrinkles here how the market reads these tea leaves. If I see
Fed put if I see Worsh put together a a task force for inflation and it's like Bowman and and Cook and William >> Stan Denmiller is on the task force. Oh,
But >> by the way, if Stan Draen Miller is on >> by the way, if Stan Draen Miller is on one of these task forces, you can expect that for me, every announcement from one of these task forces is going to be a
incredible. >> So, on the scale blue is dovish, red is hawkish, right? So, just again the perception here, if you have WSH and doubbish people, I should say, if they're the ones who are on the task
If you have someone like Hammock over in Cleveland, the Cleveland Fed president under Loretta Master now under Hammock, big- time hawk. >> If she's on the task force and it's Logan and Schmid and Kashkari, they tell
serious about crushing inflation and like that can be the that like, oh yeah, rate hikes. >> So now we have this new stupid game to play as Fed Kremlinologists, I suppose, where we have to see who goes on to what
people, you know, >> it's not he said that as much already. >> I know, but not every task force may just be all outside, right? If he all sudden brings an inflation task force and it's um
>> just just just name all like the von me people that are out in the world in the >> It's going to be a signal. >> Can we get some monitorrists? We need we we have five task forces to fill. >> Yeah. Right. Who's the guy on Twitter?
Like if he gets the Rudy Havenstein >> Twitter character, like he gets him on one of the task force, that's going to send you a signal. If he gets a a monetary theorists type of folks on the task force that's going to tell you a
signal about Fed policy. But Ilia, this was just the third time in history. I think this deserves noting here. Is there any signal that comes out of this? The NASDAQ a few days ago had a 3% day. How often? Little quiz here, chat. This
goes to you too. NASDAQ just had a 3% day and then it saw all of its gains day and then it saw all of its gains given back within the next two sessions. The VIX also closed below under 20. How many times has this happened before in
history, including today? >> That's a great question. I don't know. >> Wow. >> It's never happened. Doesn't happen all
that frequently. Uh the last time that we saw this happened is in the midst of the uh pullback that we have going into the fourth quarter of 2018. The third time that we've seen it aside from today in that other instance. You
have to go back to [snorts] March 2020. >> Oh wow, that's uh fun. >> So it's a very small sample size, but again it's not usually something that happens um before a bull market takes
usually something that occurs when the market is getting ready to take a little bit of a dip. Again, it's only n equals 3 and this is number three. So, I'm not The return profiles obviously are very different too. Ilia go out 6 months from
from December from November 2018 versus uh March 2020 and you're going to get a very different six-month return profile for the market or a year or five years.
it, but it's just it's not great. There's not great omens right now. I'm though. >> We have our NASDAQ level. We have our from the middle of May. If we maintain them and we're holding above them right
deltas that were put on last week in the NASDAQ. If we don't, we get them off the books. I think I'm done speaking here. That's a lot of numbers. I mean, for me, it's pretty straightforward here. Um, I'm
pretty straightforward here. Um, I'm looking at existing short call bets in looking at existing short call bets in NASDAQ and the S&P at this point. Um, they've got 44 days left in them. So, and and they're aiming to essentially
say that the high from the beginning of June is the high. That's the bet. At least that's the riskreward map that that's the high. And then until you break that high, you have not invalidated the riskreward of the idea.
So okay, let's see what that looks like. Then when you look at gold, uh I think opportunity here. We talked about it earlier as the Fed was coming on. Uh we
are getting some understandable friction at former resistance. Um, and now we're looking at a very interesting sort of setup here where
this might well be the place to sell some gold. Now, if you look at a 4hour some gold. Now, if you look at a 4hour chart here, uh, I think you can kind of see where the underside of the range is that we're coming in to test. Um, we're
right around there. So, I'm a seller of gold here. Um, I'm going to start gold here. Um, I'm going to start getting back into it with um the scaling getting back into it with um the scaling of one OZ futures contract. Um, so far
I've just got the one on, but I'll do more as um as the thing starts to build down. And I think the US dollar is a great setup here. I mean, take take a look at the euro. I mean, just 6 6E 6A. I mean, these are clear
breaks. And I've been holding uh the long side here for a while. In fact, I just rolled into the next few futures contracts uh last week. I'm short euro. I'm short Aussie. I'm short pound. Um I'm short
the Swiss Frank in my spot account. On we go. >> On we go. Yeah, Euro dollar here is breaking down. The dollar had a really nice day today. Pound dollar likewise. But the one that stands out to me the
most is what's happening in the uh Canadian dollar here. Ilia, this is a weekly chart going back to the lows that we have in July 23. It made its breakout started to accelerate. If but as dollar CAD goes, so too does the rest of the
>> Often times, yeah. >> Yeah. Not all the time, but it feels it a rule of thumb, right? You can basically lean in that direction. in most of the occasion. So the fact that dollar CAD is breaking out right now,
maybe it's sign of acceleration in the US economy, you were concerned about overheating, maybe it's a sign that the dollar is getting liquidity demand back at the end of the day. Uh but either way though, higher yields, higher dollar,
not good for your metals complex right now, Ilia, small bounce here in the after hours. We've gone through 25 minutes of additional trading post close minutes of additional trading post close so far and it's been good. 7471 wash out
low and we're now back to 7507. So, a little bit of a 30 point bounce here. Half a percent bounce coming together in the S&P 500. Ilia, maybe this won't be a 1% down day after all before we get to the 5:00 p.m. close. But that's a
tackle because overtime is now out of time for this Wednesday, uh, June 17th. We'll be back tomorrow, same time, same place. We'll call it what? 4 Eastern, 3 sounds good. We're going to take a brief break here on Tasty Live. IASPX back
with back money coming up next. See you then everybody.
approved FINRA's proposal to eliminate the pattern day trader rule, also known the pattern day trader rule, also known as the PDT rule. This is a big deal for many retail traders. For more than 20 years, the PDT rule has been a major
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the first monetary policy announcement to be helmed by new Fed chair Kevin Worsh. This is Macro Money. I'm Spac, head of global macro here at Tasty Live and we are going to take a look at everything that's happened here and why
everything that's happened here and why the markets are in such a shaken state in the wake of this. Of course, uh the question front and center is did the Fed just break the stock market rally and frankly quite a few other things besides
uh we're going to take a look at the price action as ever as our jumpoff price action as ever as our jumpoff point. Here is the S&P 500. And what we point. Here is the S&P 500. And what we see here uh is of course starting to
look very much like it could be a double top of some sort. So we came back um with this rally once we got the news that we're going to have a US Iran deal
on reopening the straight of Hormuz or at least an agreement to talk about one. Washington and Thrron expected to be signed imminently and copies of a 14point plan have already started to circulate as of last night.
circulate as of last night. Leaks are of course um to be expected in this kind of an environment. Uh apparently the thing was getting shopped around the G7 uh in France and not surprisingly some reporters got their
surprisingly some reporters got their hands on it. So we have this thing give us a rally and of course yesterday everything stalls after one day's rise going to happen with this Fed policy announcement or at the very least uh
recognizing that there was event risk that was on the menu that was going to be something that the markets have to contend with and something that the markets didn't want to have conviction ahead of seeing And
because in the wake of this policy announcement, the markets are down and they're pulling back through this former level here. This was resistance then support uh and we're seemingly back through it now. Again, we're kind of in
through it now. Again, we're kind of in the choppy part of this range here, but the same architecture of the down move that was here on the first attempt to break above these levels. fading volume, negative divergence on the relative
strength index. The same thing is occurring here. And for the relative strength index, it's frankly more acute. The divergence between this being a nominally higher high and this being nowhere close to the preceding high in
RSI, that's quite telling of fading momentum. Uh but the volume story was very much the same again. And it looks like we're starting to carve out what could be a double top. We'll see if that's the way
it plays out going forward. But at the very least, risk sentiment, having listened to Kevin Walsh explain what the new Fed looks like, was not what the new Fed looks like, was not impressed. Uh the situation in crude
oil, very interesting here as well. Of course that memorandum of understanding reason for oil to come off as geopolitical risk exits the market but
number of interesting things here. So yesterday crude oil continues to decline but obviously that's not enough of a motivator for stocks. They are already motivator for stocks. They are already looking ahead to the Fed at that stage.
And uh while the opening gap here down after that news of the after that news of the the imminent reopening or at least a deal to start the march toward the reopening of the straight of Corus while
that ends up of course giving sentiment a lift. You can see that's this most recent green bar here. It already breaks down as of yesterday and today crude oil down as of yesterday and today crude oil doesn't really go anywhere but pointedly
it stops falling and it stops falling in a very auspicious spot right at this bottom of the sort of wartime range where we've carved it out before. Now, where we've carved it out before. Now, there's a kind of middle chop area here.
This range top, this range bottom, and so in here, it's kind of anyone's guess where you might go, but you might suspect that this is about fair value.
And if this overall rage kind of represents the extent of the scarring that the market has endured as a consequence of this war where of course here was where we started the year and we started to creep higher here was the
impact of the war. This is where we've kind of baked in from the very beginnings of it going all the way back to March as the sort of cumulative shock. We're pointedly holding that level. We are not unclenching
level. We are not unclenching that impetus. And so it'll be interesting to see if perhaps this ends up looking like a bottom for crude oil rather than anything else. We'll see if there's conviction to break this level,
but for now, it looks like maybe crude oil is done giving the markets a oil is done giving the markets a disinflationary or at least a uh a a relief of inflationary risk kind of a tailwind.
Looking at what's going on with gold, of course, uh the implications are wholly consistent with what we see in stocks and what we see in oil with oil having
perhaps reached as far as it's going to reach on just diminished geopolitical reach on just diminished geopolitical risk premium alone and stocks apparently not liking what they heard from the Fed. We likewise get a response from gold
where we get rejected at this former support now resistance as if to reassert the fact that the trend here is down. Lower highs, lower lows and perhaps the
beginnings of the next leg down to retest this retest this lower range bottom again. So far, all of this comporting to a Fed that sounded more hawkish than the markets were
anticipating. It's the same story in the bonds. Not surprisingly, we get um rejected at the range top that we identified over the past several days. Bonds again doing this thing where while stocks have the capacity for more
stocks have the capacity for more exuberance around headlines and the unraveling of geopolitical risk at least to some extent uh certainly helping stocks although they ultimately don't break out certainly helping acrude
although it ultimately doesn't break out landing with something of a thud in landing with something of a thud in bonds where there's not really even an attempt to unclench the idea that what all of this means over recent months is
a slide in bonds and of course in parallel a rise in interest rates.
stab at the top of this major multimonth range. And of course, as we've been talking about, it's had its own little uptrend developing here since the lows
in April. And we don't just hold it uh here. We bounce off it. And so all of what we had here as the initial pullback in the dollar around theou around maybe
some relief uh from the geopolitical risk, it's at this point gone. Now, we don't have a convincing breakout yet perhaps for the dollar index, but the likes of the euro itself, uh the pound, the Aussie, uh seeing much more
the Aussie, uh seeing much more convincing signs of reversals here and convincing signs of reversals here and um maybe setting up the stage for the um maybe setting up the stage for the next leg higher for the green back. We'd
have to see a little bit of confirmation on overall DXY. And uh it's not as convincing or more convincing depending on which of the dollar crosses you look on which of the dollar crosses you look at, but almost all of the complex here,
almost all major currencies weakened considerably against the dollar in this And so naturally, the question becomes, well, what did the Fed say?
What was it that got everybody in such a huff? Here's the Fed statement. And if it seems short, well, that's kind of the seems short, well, that's kind of the point. We have here a very brief view of
what's going on and uh just the first kind of initial perspective on the kind kind of initial perspective on the kind of Fed that we are going to have going forward. Now the important uh and uh significant
thing here perhaps is to consider that what we're looking is to consider that what we're looking at more than anything at more than anything seems to be a kind of shift away from
forward guidance. The Fed did a lot more writing in its prior statements. it is writing in its prior statements. it is doing considerably less of it here. And doing considerably less of it here. And so the upshot seems to be that the Fed
is just going to let the markets have more two-way risk around what policy is and how things are going to progress from here. here. But if we look at what
this says, so not surprisingly, the committee decided to maintain the target range uh for the Fed funds rate unchanged. That was widely expected.
unchanged. That was widely expected. What's perhaps critical here is the bit about inflation. Economic activity is expanding at a solid pace despite elevated uncertainty that owes in part to the conflict in the Middle East.
Productivity growth and capital investment are strong. Read more inflation. Job gains have kept pace with the workforce and the unemployment rate has changed little. So there's not really an inflationary impetus here from
the labor market as such in this conversation. But perhaps conversation. But perhaps there is one here from the Middle East that's being acknowledged and another one from productivity growth and from
capital investment. Inflation remains elevated relative to the committee's 2% goal in part reflecting supply shocks. That's of course what we've uh been looking at with the oil that have driven
uh price increases in certain sectors including energy. But perhaps the most important part of this whole statement is this right here. this whole statement is this right here. Now, this is a refrain that
Now, this is a refrain that Chair Walsh would repeat over and over Chair Walsh would repeat over and over and over and over again in the press conference following this meeting because in so much as this is a move
away from forward guidance, all the range of questions that came from the many uh the many reporters that asked them all got a similar cordial but curt We don't do forward guidance anymore.
But this part the Fed chair was absolutely unambiguous about. He kept saying over and over again, we
will deliver price stability. We continue to define that as 2% inflation, and we're going to get to the business of getting there. Now,
this makes the summary of economic projections this goround especially interesting because what we find here just first of all
a significant hawkish rethink of the rates path and hawkish rethink of the rates path and let's just start right there. It looks like the Fed thought we were going to have rates at 3.4 for this
going to have rates at 3.4 for this year. Now, an important caveat in this conversation is that of course rates are currently above that level.
So, 3.4 uh was going to be something that the uh was going to be something that the Fed was going to be able to do after a a cut. And so when we look at where the market
thought, okay, well, we're going to get to 3.4 to 3.4 this year, uh, a critical consideration of in that conversation is that rates are currently in the 3.5 to 3.75
are currently in the 3.5 to 3.75 range. So that's one cut already implied. Now, what the Fed is saying here is we're not going to have that cut. And in saying that we're going to have a
range at 3.8, we're saying we're going to have at least one rate increase. Because if we consider of course the Fed sets uh policy in ranges uh if we're
currently in the 3.5 to 3.75 to 3.75 range uh then we're at about 3.6 range uh then we're at about 3.6 in the logic of this dot plot. 3.8 would
imply one hike. Now, it looks like by next year there is an expectation that we could take that rate hike back. So, uh we're up to 3.6
rate hike back. So, uh we're up to 3.6 and then we get to 3.4 which was where we were supposed to end up based on the March projection this year. So in other March projection this year. So in other words, there is a kind of hiccup here in
words, there is a kind of hiccup here in the Fed's path. Rather than delivering one cut this year, the Fed is going to deliver one hike, take it back in 2027, and then deliver the cut that they were uh on the menu to do this year two years
later. Obviously, this is going to translate to much higher rates over the entire period. Though we can see the longer run numbers remain uh and we continue to call for a 3.1 um longer run view. Now,
call for a 3.1 um longer run view. Now, a critical part of this dot plot update a critical part of this dot plot update is that Worsh did not contribute to it. he has a uh philosophical disagreement with the idea of a dot plot and he did
not participate. So this is the view of everybody except Kevin Walsh on the FOMC. And that's a fascinating thing because
when the Fed chair came out, he basically said, "I will not speak to anything that that is not already in the dot plot because guess what? We don't do forward guidance." Well, la dah. Okay. So this then looks
Well, la dah. Okay. So this then looks very hawkish. What say you, Kevin Walsh, who came into the job of Fed chair with a mandate from the White House to be a a mandate from the White House to be a lot more dovish than former chair Jerome
Powell? Well, the committee will deliver [clears throat] price stability is what the chair says. And short of any further explanation, this is how the committee defines what
price stability is. Then, now consider the other adjustments. growth revised the other adjustments. growth revised lower for this year, revised higher for 2028, which comports interestingly with there being a rate uh cut that year. The
unemployment rate seen a little bit lower this year than previously lower this year than previously expected, otherwise steady. inflation expected, otherwise steady. inflation much higher this year but seemingly
somewhat transitory flavored. We can see here that the big spike is this year then things start to cool off next year and then we kind of cool off next year and then we kind of even out by 2028. But there is a
even out by 2028. But there is a meaningful hump here of inflation and not surprisingly that implies higher rates and if you listen to the Fed rates and if you listen to the Fed chair. His perspective is price
stability is where we got to go that's 2% inflation. Now, in his press conference, Worsh also announced that he's going to be introducing five he's going to be introducing five different task forces to look into
changes, institutional changes to various uh things that the Fed does. a task force on the balance sheet, a task force on how the Fed looks at economic force on how the Fed looks at economic data, a task force on inflation, a task
force on labor market, a task force even force on labor market, a task force even on um innovation and AI. Uh all of these together and they're supposed to be made up of people from within and from
without the Fed. The Fed chair stressed he wants the best minds. Okay, that's a good start, I suppose. Then he expects that we're going to start to see work on this begin in the coming weeks, take the next
several months to play out and end up with results by year end. In the meantime, it looks like we're going to have business as usual for continuity other than things like much shorter policy statements than
perhaps folks were used to. even just a signal it's a new day. Do not expect for us to continue to do uh everything as we've done before. There is a clear
we've done before. There is a clear shift in leadership here at the Fed and shift in leadership here at the Fed and a clear shift in what people want to do. So looking at this then this becomes the
baseline wisdom for now. War stressed that the 2% inflation goal is outside the scope of their rethink of the Fed as an institutional framework. So that stays. Maybe the way that you measure what inflation is and
Chair Walsh is famous for liking the trimmed mean measure which estimates inflation lower than some of the other headline numbers currently. But sometimes it's a different story. And so even if that were the case and the bogey
were to change and essentially he would move around the goalpost and say, "Well, we're closer to 2% inflation than than thought because we're going to change the way that we define what 2% inflation is. Is it 2% CPI or
PCE or Dallas Fed trimmed mean?" Well, those are different targets. If that occurs, it doesn't occur until the end of the year.
In the meantime, we're still targeting 2% PCE inflation. We're clearly oceans away from that.
The Fed chair is stressing we're going to deliver price stability with a view that it should have been done yesterday and so a significant sense of urgency. The committee is saying that means rate
hikes. Fed chair is not resisting, at least not openly. What does that mean for markets? Well, looking at Fed funds futures here, we've got a full rate hike and then some
got a full rate hike and then some priced in for this year. Uh 36 basis priced in for this year. Uh 36 basis points reflected in Fed funds futures. points reflected in Fed funds futures. Uh that's at least one hike fully
discounted. uh and about 11 basis points in the uh in the direction of a second which makes it uh narrowly better than even odds. Uh that's dramatic of course and then for next year we reflect the idea as we see in the dot plot that the
Fed wants to take the rate hike back. So down almost 19 basis points next year. down almost 19 basis points next year. So again, a kind of hump in uh the Fed outlook here where we hike this year, we take it back next year, but because of
this disconnect here between 36 basis points and 19, the bias is clearly leaning in a hawkish direction. If we look at the aggregated probabilities here, we can see the market has dramatically increased when these rate
dramatically increased when these rate hikes were uh supposed to arrive. It's certainly a stark thing to say, well, here we we just had the June meeting. We're going to have another one in July. By September, the next update of the
summary of economic projections, we've got an 8020 chance that in a cumulative way across a range of scenarios that we're going to get at least one hike. By October,
we're looking at 95% probability that we're going to get that hike. And by we're going to get that hike. And by December, we've got a 53% chance that we have had two hikes. In fact, we've got a second hike on the
menu. Again, cumulative um probabilities here all the way through the end of next year. and only by the end of next year do we start taking that hike back.
So we're looking at a situation here that's much more hawkishly minded than what the markets were aiming at. And everything that uh
the Fed chair said really seem to suggest that he's interested in price suggest that he's interested in price stability first and foremost. And if the committee seems to suggest that that means a hike or two, he
doesn't particularly seem to have an issue with that. Now, of course, that makes sense. We've uh been talking about the idea that especially the most recent ones, the most striking thing is that we had an
increase in core services inflation that boosted core prices even outside of the obvious shock on the energy side as a consequence of the US Iran war. And then when we uh pull apart that core uh inflation
uh into three main components we can see uh the most important piece of it of course is services. Uh we can see here that core services accounts for over 2%
out of the 2.9% in overall core inflation. Whereas what's going on in goods is tiny. And although it's a decline, that decline seems to mainly reflect early signs of demand uh uh destruction. A lot of this
demand uh uh destruction. A lot of this seems uh seems to be a fading demand seems uh seems to be a fading demand pool price impetus in cars and auto parts which of course are sensitive to higher energy prices. So the key here is
higher energy prices. So the key here is this. The pickup in core services inflation, the stickiest and the most uh significant driver of overall
direction and a rebound here all the way back to levels we hadn't seen since the middle of last year before that disinflation that got last year's Fed to cut by 75 basis points toward the end of the year.
And needless to say, the question here is, okay, well, why are we getting this rise in core? Isn't uh the shock here mainly energy? And of course, we've already seen over the past several months that the inflation from energy is
spilling over into core via things like warehousing costs, freight costs, and warehousing costs, freight costs, and that's occurring in both uh wholesale inflation, so PPI as well as u at the consumer level, CPI, which we've got on
consumer level, CPI, which we've got on the chart here. Uh, and that's already spillover. But the Fed was talking about inflation quickening even before this inflation quickening even before this war started to present evidence about
what its impact is going to be. We already heard that from former Fed Chair Powell back in March and subsequently in May. So we're
and subsequently in May. So we're looking already at a situation according to the rhetoric then where inflation was quickening and then there would later assess and obviously is now able to assess better as can we looking
at this CPI data and seeing the scarring from the war holding u and now perhaps increasingly baked in on the services side That inflationary impetus before the energy shock, as we've discussed again,
comes largely from the makeup of the way that the economy has been growing so far this year. We've said that the economy has only recovered about halfway to the quarter of last year, which was closer to 4% after a big downturn in the fourth
quarter around the government shutdown that slowed growth to just half of a percent. We're almost back to 2% in the in the first quarter, but we can see it's mainly driven by a contribution from investment whereas um the
contribution from consumption is relatively modest. Uh and that of course is very eye-catching considering the consumer spending part of GDP is five times larger than the investment part. Consumption is about 68%
investment only about 14. Now, the way that you get such a small engine to propel the whole ship is you have to run it really hot and
really fast. And that's of course exactly what we've seen thanks to this AI data center buildout. Business investment scorchingly hot at 10.4% 4% investment scorchingly hot at 10.4% 4% year onyear um or annualized rather um
in the first quarter GDP numbers whereas consumption slowed for a second consecutive quarter and by the way sure it slowed during the government shutdown but post government shutdown it just kept slowing so the consumer here
understandably hamstrung tariffs and u the energy shock certainly tariffs and u the energy shock certainly don't help. But when you have to have this kind of a mix to drive growth, well, you're going to spin that small
engine of investment really hot and go really, really fast to not get very far at the headline. And of course that means inflation onto
itself, making the Fed's uh now hawkish disposition an understandable one of course because all that we've had since this lay of the land started to emerge are further
inflationary risks. Uh the US Iran war of course chief among them. And so from of course chief among them. And so from a positioning perspective here, um I am back short gold. Um that looked like a trade uh that was starting to come
trade uh that was starting to come around again. Uh we we've of course seen this trend develop and we've been shorted really all year, but uh we got
didn't pick the exact bottom. That rarely ever happens, but it's been a lucrative idea being short gold this year. And now looks like it might be time to get back in. And so that's what I've done here. I'll scale this up um to
the degree that it works. Uh, I'm still very much long, so short the Aussie, the pound, the euro, uh, in my spot account. Also short the Swiss Frank. Uh, I'm
Also short the Swiss Frank. Uh, I'm still uh looking at these puts in the still uh looking at these puts in the bonds. Um, the TLT put vertical I had bonds. Um, the TLT put vertical I had essentially expired worthless. But these
puts that I have here, they still got plenty of time on them. They're at the middle of the curve, which seems to have worked better. Uh, and so they're still there looking for higher rates. And of course,
the pain in risk sentiment finally comes around today. And so I'm still looking at these short call verticals in the NASDAQ via the Q's, in the S&P, via SPY.
NASDAQ via the Q's, in the S&P, via SPY. Uh, and I'm still long a driver of inflation here via this call vertical in natural gas. We'll see how that develops. We'll see also how oil develops. It might be time soon enough
to get back long that, but we need a little bit of confirmation here as we little bit of confirmation here as we look at what happens at support. Uh, as uh we can see here from earlier in the show, it was testing here, but we don't
quite know that it won't break yet. We need some sort of a sign of life and uh we'll be on the lookout for that. And that is macro money for today. As ever,
we are here right after overtime. That's a show that I co-host with Chris Veio, looking at the Wall Street close and where things might go there from. I'm also writing for the news and insights portion of tasty live.com and commenting
at IASPAC on former Twitter and on Blue Sky. If you're watching this on YouTube, like and subscribe. Macro Money returns tomorrow. Happy trading.
June 17th. You're watching Tasty Live. I am Jamal Chandler joined by