IWM
iShares Russell 2000 ETF
stock NYSE ETF

calls on GLD and puts on IWM

In the afternoon sure. The first few hours was a ping pong pennant with an almost $4 initial range. I caught the second bounce and sold for a quick 45%. Moved on to IWM later in the day when it broke past support (which also was low of day on Monday but still a relevant level). Those puts went for 135%
https://preview.redd.it/2o0ipz64q5qh1.jpeg?width=1080&format=pjpg&auto=webp&s=4110ad3fd1fcebb2cd0046c38b6f23726486b8e2

Ping pong range trading still works beautifully. Parlay 30-50% wins instead of hunting for 1000% winners. I usually only trade SPY, QQQ and IWM and there are easier wins daily. With low volatility a $1 price move in SPY or QQQ is a 40-50% profit potential. Just don't hold too long

IWM puts

The Semis are what are catching a bid today. I have no idea if that will extend into tomorrow, but INTC, NVDA, and AMD all have had good looking charts. I like the look of GOOL with this pullback. MSFT is not so hot now that it seems to be losing the 20-day. AMZN is a mess. Wouldn't touch it until $235 if it were my money. I've been playing MU on and off, but I kind of hate it here. You've got about $20-$25 of upside versus $180 of downside right now based on where it's trading. AVGO is a dog's breakfast of a chart. I think I'd stay away until it can find a bottom around $315, maybe a smidge lower.
If you're playing indexes, I continue to like the Qs more than the others right now. IWM and Diamonds are breaking down. Qs look a little more constructive than SPY.

Y’all think the guy who bought $10K of SPY and $10K of IWM calls held yesterday?

**BanBet Lost** — /u/Jobless-Dev (0W - 8L, 0%)
| Ticker | Entry → Target | Move | Time | Result |
|:---:|:---:|:---:|:---:|:---:|
| **IWM** ▲ | $285.21 → $292.00 | +2.4% | 1d | Lost |

Where’s the guy that bought 10K worth of SPY and IWM calls expiring in 2 weeks?

Got just a few qqq and IWM puts just in case it tanks from the q&a. Nothing that will make me rich or poor.

Of course IWM pumped on rate hike 🤡🤡🤡🤡🤡

IWM puts locked....let's go

IWM doesnt know where it wants to go next
1m candles are literally cancelling eachother out

Despite IWM being lower then when I bought and eating 3.5hrs of theta it's at breakeven. IV is insane right now. They'd either suprise hold and I'll get tendies today or this shit goes straight to 0

Suprise rate hold, IWM 3% spike, my yearly pnl turns green. Then I wake up

IWM will fall no matter the fed decision....Russy is too price sensitive

I need a rate hold and IWM to go apeshit bannana republic today

Imagine the fate of your portfolio being in the hands of smallcap index composed of pure shit to move 2% up on the day. Anyway yolo deep OTM overnight IWM calls might not have been the move

Well, IWM has seen some of the most un-intuitive price action this year. Pure retard power. 😄

The Fed decision is the main event today, but at this point the 25bp hike itself is secondary and the more important question is what the Fed signals about the path from here.
So the real risk tonight is whether the dots validate the additional tightening the market has already priced.
Now, how is the market positioning according to the datapoints I am tracking.
Bullish TLT volumes are picking up quite a bit as you can see from the chart below. The bullish flows hitting the treasury ETF mean that expectations for a drop in yields are increasing.
While positioning is still leaning negative
[Options Volumes TLT](https://preview.redd.it/x6oa6raf0vph1.png?width=612&format=png&auto=webp&s=5e400f8f0c54baf02586a6be0de36bb22c991dfe)
https://preview.redd.it/ssjkcpjg0vph1.png?width=612&format=png&auto=webp&s=65761c1ea9ce699baf995dcbe5110e9ede03269d
Options market is pricing and implied FOMC-day move a bit under ±1%. for the SPX
That translates to roughly 7,5 points in SPY which aligns with how much it has moved on FOMC days.
The important thing is that options are not pricing an unusually large fear premium
https://preview.redd.it/wyrpzwui0vph1.png?width=482&format=png&auto=webp&s=1559d2b94d6aa90ec9901ce4c0a93212b170c84f
But do note that through Friday the implied move closer to 13 points
Performance of the S&P500 has generally been good on first hike days recently as you can see from the table with the exceptions being 94 and 97
|**First Fed Hike Date**|**S&P 500 Performance on Day**|
|:-|:-|
|February 4, 1994|\-2.30%|
|March 25, 1997|\-0.20%|
|June 30, 1999|0.016|
|June 30, 2004|0.004|
|December 16, 2015|0.015|
|March 16, 2022|0.022|
What I’ve also been seeing is some strong bullish options activity in IWM, the ETF tracking the Russell 2000. This is an indirect bet that rates are going to remain contained, as the small-cap index is very rate-sensitive.
https://preview.redd.it/7hfhxyx11vph1.png?width=821&format=png&auto=webp&s=58c4dd87c3c8b3e4028c950ac34decf89b625902
VIX, which, if you remember, saw some aggressive call buying ahead of the sell-off, has now started attracting some bearish flow. The strikes are quite far from spot though so I wouldn’t read too much into it as a near term directional signal as it looks more like cheap positioning for an extreme move lower in volatility.
https://preview.redd.it/tjkdc1n51vph1.png?width=835&format=png&auto=webp&s=0c6effcbf87863e3679bda5a4c152e34ead4e1eb
Some data on the PCE diffusion metric that Warsh introduced during Jackson Hole, and it should be falling in August, so this could make him a bit less hawkish.
https://preview.redd.it/xlmui8e61vph1.png?width=1140&format=png&auto=webp&s=cc9375b40f8ba77bf794e852120d53dcf1028664
This is from a GS report this morning showing that their models are also showing PCE lower
https://preview.redd.it/5wecz9571vph1.png?width=740&format=png&auto=webp&s=fcc1539c7c760bff29df9a6d11eb21867c309a22
if we get a 25bps hike with no forward guidance, or a 25bps hike while guiding that the October and December rate cuts will be taken back, then thats probably it. The market will likely like that.
That would start a transition toward a calmer vol regime after OPEX.
If, however, he uses wording like rates need to be “materially” higher, then I think the market is going to react very negatively.
Then $750 on the SPY comes into play. This is the main level for now and it will provide some stabilising flows as long as iot holds. If price moves below it, market makers will turn to aggressive hedging and exaggerate the move to the downside.
https://preview.redd.it/8z9r3y391vph1.png?width=612&format=png&auto=webp&s=ff86520c714335a78cbca179a915f35eee05ac1d
Note that the 750 level corresponds almost perfectly to the implied move the market is pricing as of premarket price early morning.
740 should be a daily bottom if Warsh comes out very hawkish - options market positioning in the next 5 DTE contracts is almost non existent.
https://preview.redd.it/odquqj2a1vph1.png?width=571&format=png&auto=webp&s=608afbd48be3aa176908dfb1b06892136592a1ec
I do wanted to share one more datapoint which is making me more cautious and its some massive bearish flows hitting TSM - deep-ITM call selling ahead of the Fed decision, with the contracts expiring Friday and covering Fed and its immediate aftermath is a big hedging/beraish signal, although the headline premium of about $500m. is heavily inflated by intrinsic value.
https://preview.redd.it/yf4zzvqa1vph1.png?width=822&format=png&auto=webp&s=b1db358d80aaeb6b45a7e3c373cf5fdacde3fdbd
TLDR - The 25bp Fed hike is priced, so the real market risk is what Warsh signals about the path from here. Positioning is mixed but broadly suggests expectations for contained yields and no major fear premium, with bullish TLT and IWM flow offset by still-negative Treasury positioning and some notable bearish hedging in TSM. A measured hike with limited forward guidance could be taken well and help volatility calm after OPEX. Language suggesting rates need to move “materially” higher will pressure equities. For SPY, $750 remains the mian level, with a break below potentially triggering more aggressive dealer hedging and opening the door toward 740.

!banbet IWM 292 1d