When vol spikes, traders sell S&Ps to hedge. S&Ps drop, vol spikes more. Repeat. We're in one now.
| | | Volatility closed Friday in backwardation. | If you don't know what that means, here's the short version: the market is pricing MORE risk in the next 40 days than it is 100 days out. | That's backwards. That's fear. | And when you get vol into backwardation, you get caught in a feedback loop. | Traders who are short volatility have to sell S&P futures to hedge their positions. The S&Ps drop. That forces volatility higher. Which forces more S&P selling. Which pushes vol even higher. | It feeds on itself. | We're in that loop right now. | VIX closed at 28 — up 17% Friday. Oil blasted through $90. Expected move jumped to $229 for next week. | And now we wake up to Trump threatening "complete destruction" of certain areas in Iran. Tehran's Mehrabad airport is in flames. Israeli strikes continue. Iranian drones hit Dubai overnight. | Six US service members are being flown home today. | This isn't resolving over the weekend. | Here's what happens next: either geopolitical tensions ease and we get a relief rally Monday — or they don't, and the downside is wide open. | The S&P is hanging on by a thread. We're still only 4% off all-time highs. But that thread is fraying. | And if you're trading a small account right now without a system, you're one bad trade away from getting wiped out. | That's not hyperbole. That's math. | The 3 Trade Micro-Challenge was built for exactly this scenario. | You don't overtrade. You don't chase. You get 3 setups per week — entries, exits, risk defined — and you execute them with discipline. | When volatility spikes like this, discipline is the ONLY edge that matters. | We're running this offer through Sunday. | Name your own price for the first month. | Then $79/month. Cancel anytime. | I don't know when we'll run this again. | If you want to trade through what's coming without blowing up your account, this is the system. | ⇒ Join the 3 Trade Micro-Challenge now — before Monday's open | To your success, | Don Kaufman | | |
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