The VIX closed at 20.09, above its 10-day moving average of 17.63 and below its 200-day moving average of 22.72. The S&P 500 index closed at 4061.23, below its 10-day moving average of 4114.24 and above its 200-day moving average of 3969.84. Looking at the VIX options data, we can analyze the call and put volumes separately to get a better understanding of the market sentiment.
Call Option Analysis
The total call volume was 2,674,222 contracts. Out of those, 262,227 contracts traded at BID or below, 539,682 contracts traded at ASK or above, and 1,872,313 contracts traded between the market spread. The majority of the contracts traded were in the 0-20 delta call range, with 1,285,616 contracts traded. The 21-40 delta call range saw 910,298 contracts traded, followed by the 41-60 delta call range with 418,847 contracts traded. The 61-80 delta call range and the 81-100 delta call range had 43,524 and 15,937 contracts traded, respectively. The current IV percentile is 45%, and the put to call ratio is 0.223. The Sizzle index, which measures the ratio of daily volume to open interest, is 13.01.
Put Option Analysis
The total put volume was 595,952 contracts. Out of those, 118,972 contracts traded at BID or below, 111,014 contracts traded at ASK or above, and 365,966 contracts traded between the market spread. The majority of the contracts traded were in the 0-20 delta put range, with 164,553 contracts traded. The 21-40 delta put range saw 170,586 contracts traded, followed by the 41-60 delta put range with 117,848 contracts traded. The 61-80 delta put range and the 81-100 delta put range had 87,807 and 55,158 contracts traded, respectively.
Market Direction
Short-term
The high volume of call options traded, especially in the 0-20 delta range, suggests bullish sentiment in the short term. The put to call ratio of 0.223 also supports this sentiment, as it is relatively low compared to historical averages. However, the current IV percentile of 45% indicates that there may be a higher level of uncertainty in the short term.
Long-term
Looking at the long term, the VIX's 200-day moving average of 22.72 is above the current VIX level of 20.09, suggesting that the market may trend upward in the long term. Additionally, the S&P 500 index is currently above its 200-day moving average of 3969.84, which is a positive sign for the long term. However, it is important to note that the current IV percentile of 45% indicates that there is still a level of uncertainty in the long term.
Conclusion
In conclusion, the high volume of call options traded in the 0-20 delta range suggests bullish sentiment in the short term. The VIX's 200-day moving average being above the current VIX level, and the S&P 500 index being above its 200-day moving average suggest that the market may trend upward in the long term. It is important to keep in mind the level of uncertainty indicated by the current IV percentile, and to consider this when making investment decisions (Read more on "How to secure your family's financial future").
Glossary
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Disclaimer
The information provided in this article is for educational purposes only and does not constitute financial or legal advice. Please consult with a financial advisor or attorney before making any investment decisions or creating an estate plan.
The information provided in this financial blog is for educational purposes only and does not constitute financial advice. Please note that the views and opinions expressed in this blog are solely those of the author and do not necessarily reflect the official policy or position of his firm. The content of this blog is based on the opinions of the author and should not be relied upon as a substitute for professional advice. Before making any financial decisions, readers should consult with a financial advisor or other professional to discuss their specific situation and investment objectives. The author of this blog is not responsible for any losses, damages, or other liabilities incurred as a result of using or relying on any information provided in this blog. All information provided in this blog is accurate and reliable to the best of the author's knowledge, but no representations or warranties are made regarding its accuracy, completeness, or timeliness. The author reserves the right to change or update the information provided in this blog at any time without notice.
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