The market liked the news, except for the short sellers, who got snookered. Qs are back to 50 on moderately large volume. Let's see how things shake out by the end of the week, when triple witching transpires. The week following TW tends to be less that stellar and that's when the short sellers may make another run at it.A whooping 23% drop in the VIX today brings it down and through the lower band and 20% below the 10 DSMA. I don't believe this condition can be sustained short term, although we may see a little follow through tomorrow prior to a reversal.
I went delta neutral on 30% of the portfolio this morning and ended up leaving some nice potential gains on the table. Nevertheless, the residual portfolio produced a good return today and because of my risk adverse attitude, I don't regret my hedging. I'm in a holding mode for the next few days until I see how the current pop plays out.
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