Good Morning,

The volatility I was hoping for never arrived.  With the big up move in equites yesterday and the fact that they are holding on to their gains, gives little incentive for day trading. The forex markets are in recoed low ranges, so summertime rolls on. Figures, as we have 10 days of no rain in the forecast for Park City. Should be a beautiful weekend and hopefully the mountain towns are packed with Labor Day vacationers. (I also hope that the city of Denver is packed with environmentally cool outdoor enthusiasts as Locals Have More Fun will be at booth 430).

Here is the VIX:

The VIX is a two way street. As it moves higher, it prices in the chance of more movement so option premiums increase (we like when options have higher volatility as that means movement). It also means higher premiums for selling options and we know that SELLERS of options bring in the premiums. With volatility low, it isn't fun to sell, although less chance of movement means you have a pretty good chance of bringing in the majority of the premium sold. More importantly, it isn't a great time to be trading short term as there isn't any movement - we are sideways to up this week as we will see in just a bit, so:

YOU MUST ADJUST YOUR TRADING STYLE/STRATEGIES TO REFLECT THE MARKETS. REMEMBER, THE MARKETS TELL US WHAT TO DO!

Also, if we bounce off our lows, which we did, the VIX (volatility, fear, uncertaintly, etc...) will go down.

The chart of the SPY:

As mentioned before, I am still a seller of rallies, so 113 looks like a choice spot and I am still holding on to my long dollar trade (stops are moving down) in anticipation of a worse than expected employment number tomorrow and as a hedge against the portfolio.

I will NOT be reporting in tomorrow, so I will give you the week-end wrap-up and week ahead look on Tuesday morning.

Have a great, safe holiday weekend and have fun with unemployment tomorrow!

Coach Brian