Sell The Rips Or Buy The Dips?
Image Source: Pixabay
We just witnessed something that hasn't happened in weeks...
And it's about to flip this entire market on its head.
Two-sided trading is officially back.
While everyone was focused on the PCE data this morning, I spotted the critical signal that changes everything.
We hit 90 products advancing while the market simultaneously dropped like a rock.
That's not supposed to happen…but it did.
Here's what made today different:
- SPX rallied 40 handles, sold off 40 handles, then rallied another 40 handles
- We touched both the upper and lower edges of our expected move in a single session
- High correlation just returned after weeks of sector rotation
- Over 12.5 million option contracts traded between SPX and SPY alone
The math is simple…
When 90% of stocks move higher but tech can't get out of its own way, you get violent reversals. That's exactly what happened when a handful of mega-cap names started backsliding and sucked the entire market down with them.
Most traders missed it because they're still thinking in terms of rotations. XLF to QQQ. Energy breakouts. Sector plays.
That game just ended.
When correlation spikes this high, everybody ends up on the same side of the boat. And when that boat tips, it tips fast. We saw a preview today with the NASDAQ's relative weakness despite all the AI news flowing around.
The real danger? Next week's expected move is only $85. The market thinks we're going back to sleep after witnessing rare volatility patterns that historically precede major moves.
Bitcoin sitting at critical 110K support tells the same story. The same retail money trading crypto is trading high-beta tech. If Bitcoin cracks, those names follow.
I'm not bearish…I'm excited!
This is the trading environment we live for. Markets that go higher AND lower.
Opportunities on both sides instead of this grinding, one-directional nonsense we've endured for weeks.
The question isn't whether volatility returns. It's whether you're ready when it does.
Video Length: 00:22:10
More By This Author:
The Mining Stock Gravy Train Just Left The StationWhen Charts Lie
The Market Has Become A Mathematical Prison