2023 Rabbit

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after the deluge, we are in a similar spot, though dropping still not in panic mode

targets have been hit, but remain in balance, some data points but now sentiment leads

the default pick should never be singular and biased one way and commodities might lead

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the large moves signal some type of significant level, whether reversal or continuation

these large ranges are normally during post fomc, the current context is more broad based

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crude is popping, vix chill and tech lagging. viewpoint is that the 4050 puts are sold/bought on the weeklies

dragging sentiment is definitely putting a damper on things

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fear is not there and dips bought, very close tipping points, but the battle is there

technical or not, the existence of a semi fed put is still there, past the tightening

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Timing on those sold puts @ 4050 ES weekly as vix hit highs. Any extreme dips could also be exercised.

Consider also that USD/JPY is a carry and dollar strength can still provide risk on environments in context of VIX.

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context of the pullback in a longer term downdraft but also GDP data next week

those 4050 weekly puts have been steadily declining in price since last week and are now considered 0dtes

would expire worthless / or exercised ITM possibly.. the dip today had less of an effect than overall decay

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a look further into next week and there exists additional 4050 puts expiring Tues FEB/21/23

after that into Weds FEB/22/23 (FOMC minutes) Thurs FEB/24/23 GDP the 4050 level thins out

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excess here likely a shakeout, but for mid term type plays, volume in the 4050s has already matched the open interest

in brief, an extreme positioning event with good r/r

excess has hit target and is now less biased, again more neutral

maybe those 4050 0dtes were exercised, but any case, the wave can be considered dip-ish

mostly by comparing the overall downwave vs. previous upwave in magnitude, more like a pullback

continuation would be data driven by upcoming minutes/gdp

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if less sensitive to day to day, then this area is positive for accumulation

would be considered a mid-stage entry in a longer time frame

..

as rate increases have not caused significant systemic shocks

and make room for event-based tail risk events (war, disease, etc.)

..

the interest rate on bonds also provides compounding to offset any interest due

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BUY

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calling this the clinch phase, where trend peters out and determines where next the compass points

late stage dips may possibly considered early stage accumulation with the caution that early may require a stomach for drawdowns

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from a longer term perspective, 2022 was a drawn out process

holding through with hedging was one solution for taxation

or, those with mid-term views may have exited Q1 '22

where Q3 '22 - Q1 '23 was a chance to accumulate

where the last such period was in 2019-2020

even longer term was 2010-2011, and so forth

not sure about supercycles

this quarter was a re-priming and action more behind the scenes

squeezemetrics.com/monitor/dix

2023 Rabbit

Discussion in Trading Journals

2023 Rabbit