How to play the banking sector collapse.

** These positions are a chase on a bank run and you absolutely should not follow me! Ever! For that matter. **

The fallout from the 2nd largest US Bank collapse since the 2008 financial crisis (Silicon Valley Bank, this morning) will have unpredictable impacts on Monday. There is an entire weekend to digest new data!

The probability spread of outcomes has exploded outwards, and the options market is mathematically nailing down the correct future, as we wait. Namely, put option activity, which has been weak lately, has become more pronounced— while calls are predictably unpopular.

The VIX has spiked 10 points in 4 days to 27.06. What a dagger it's sent through the ceiling of the 50 day moving average!!!

This time, a VIX spike is not a buying opportunity. There are too many fearful features permeating market psychology right now. That's what the VIX measures. Fear!

It's the fear index. Fear has popped in 2 days to a new high 🙂 You can trade fear. Namely, you ride with the wave, not against it ‍️

So, here are some trades I made using this hypothesis…

Put Options:

$HOOD 03/17/2023 8.50 P

$SPG 03/17/2023 110.00 P

$KRE 03/17/2023 49.00 P

$KRE 03/17/2023 51.00 P (sold for profit)

$VNQ 03/17/2023 80.00 P

$CMA 03/17/2023 57.50 P

$FITB 03/17/2023 29.00 P

$XLF 03/17/2023 32.50 P

$TQQQ 03/17/2023 21.00 P

Sold out of long positions:

$NU

$STNE

$IAT

$AVUV

$KBWR

$TNA

$TQQQ

I'm betting banks will go down on Monday

And the NASDAQ will also go down on Monday.

Surfs up