All I Want For Christmas is 7k SPOOOOOZ

Volume 158 - The Week Ahead

The S&P opened the week at 6,882, sold to 6,631, and closed -163bps on the week. For many, it felt like panic. But in reality it was a reset.

Last week I wrote, “None of this feels euphoric… this week’s wobble feels mechanical.” That turned out to be spot on. Friday’s selloff wasn’t fear, it was plumbing. CTAs flirted with their sell trigger near 6,680, liquidity pockets vanished, and the market slid into air. But once that mechanical flush ran its course, the underlying bid stepped straight back in. It’s why I also said, “The system doesn’t break; it resets.” And that’s exactly what happened - a reset, not a breakdown. At least, not yet.

The entire week proved what I meant when I wrote that this market “can swing 250 handles either way without breaking anything.” That’s exactly what it did, flushed 250 handles, shook a fair few out, and then bounced hard.

I tried trading the chaos. After being reminded twice this week that I can’t trade S&P futures successfully with a <100 point stop, I sized down - 10bps risk on the 0DTE SPX 6700C at 10, held to expiry at 28.8. Also added 5% weight ALAB at 156 (shared in the Discord), closed Friday at 165.5. I also put on a fresh SPX December position went on the book as well, details also in the chat.

But something about this reset felt different… too fast on the way down and too violent on the way back up.