🚨I’ll be live at 10 a.m. ET with Graham🚨
It’s Nvidia earnings after the close so we’ll cover that, then an income trade for everyone in attendance and more [tap to join us for Opening Playbook]
Here’s the deal — I love shorting the CBOE Volatility Index (VIX), and it’s easily one of my absolute favorite trades.
My rule of thumb is pretty simple: If the baseline VIX is sitting around 14 or 15, then the second it crosses the 20 line, I start aggressively shorting it.
But we’re living in a brand-new normal, and the base rate of volatility has elevated.
Right now, you need to drag that line straight to 22. If the VIX breaks above 22, I’m shorting it with options or put debit spreads. If it goes higher, I just add another layer.
I scale into three tiers using reverse-cost averaging and give each trade more expiration time. Shorting the VIX is a maximum-confidence play because it always comes back compressed.
Tech has been dragging the market higher by its bootstraps, but basics, energy, real estate and financials are lagging way behind.
When tech drops 15% and gives us a buying opportunity, the VIX will spike — and that’s when we step in for easy money.
⛏️ The Picks-and-Shovels Play
Massive artificial intelligence spending demands massive physical infrastructure, meaning utilities, energy and nuclear are absolute coiled springs.
📉 The Rule of 22
The historical baseline for market fear has shifted, meaning the high-confidence window to short the VIX now starts at the 22 level.
📊 The Three-Tier Option Strategy
Managing extreme volatility spikes means breaking your risk into distinct tranches and adding more duration to each consecutive contract.
Now don’t forget to join us at 10 a.m. ET weekdays for Opening Playbook, and at 3:30 p.m. ET Closing Playbook!
Opening Playbook is a bridge for both new and advanced traders to go beyond outdated market narratives into deeper understanding, live at 10 a.m. ET Monday-Friday.
Nate Tucci
Tucci Trades
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*This is for informational and educational purposes only. There is inherent risk in trading, so trade at your own risk.
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