I think structure in options markets is telling...
The trade in miners is... flat... ignored... very low volatility... very low volume... even time value is discounted in many... while holding near dated options has been "all risk, no reward"...
Oil options have been... skittish... volatile, but mostly realizing downside risks rapidly, recovering only slowly... That has meant an occasional ability to buy in the money options at discounts to the market price of the shares... which is pretty crazy. That's pretty consistent, though, with the pattern of suppression apparent in the commodities stocks recently... the intended "shock and awe" impact of massive shorts hitting the market all at once... intending to shake longs out of the market. Although, today, suddenly... oil is being touted as the "trade you must be in"... by a wide range of pundits including recent skeptics... a few now saying they have "been telling you to be long oil all along"... although most have hot said a damn thing about that being a trade to be in, until now ? So, should be an interesting week in oil... the sudden shift clearly more about "some" now anticipating major political moves than it is about larger market structure issues...
And, Biden Admin suddenly reversing course... saying they're going to be buying oil to restock the SPR instead of trying to dump it to manipulate prices lower ? Morons.
The major index options... are insane... the daily swings with the market are crazy... as market indexes might be up, or down, from half a percent to a couple of percentage points on any given day... the options trade up or down by 50-60% and more on a daily basis... while "a sustained trend" in direction in the trade is now averaging only a couple of days... Lack of liquidity is showing up as "pauses"... where the market may not move at all for a couple of days in a row... as when waiting for the Fed to tell them what to do next... so the substantial time value wasting occurring in the options trade is also crazy. But, with the volatility... the trade is still being restricted to moves in trading within "hard limits" in the range over extended time periods... the SPY recently "lowered" in range after a "pause"... still not trading lower than its prior lows at 410... dropped to 405 briefly on Friday, but closed at 411 and change... Futures now point toward 1% lower... around 407 on the SPY... but have VIX lower by 3% ? Both can't be right ? The market likely to remain excessively volatile here... at the threshold between "a correction" and "something more than a correction"... until the directional issue is resolved...
But, still see very little comment in the media... about how, back in the fall, the Fed said it would begin to taper "soon" and would have almost fully unwound all the QE by now (!!!)... and in the latest announcement... said they're finally going to end QE, and will start QT with a paltry 46 billion (out of ~ 23 trillion now) on June 1st... "and, this time, we really, really mean it"...
The "can't get there from here" market... continues...
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