The market is fighting off selling with afternoon bullishness. We have seen that scenario for two days straight. The bullishness comes from the energy sector on news of a OPEC output limit. A lot of the bearishness is coming from news around DB in Europe. With earnings and an Italian constitutional referendum coming in December, we should have an interesting Q4.
Volatility has fallen farther today, while the SKEW rose a bit. None of the indicators are particularly providing a definitive bias to the market. Most are bullish, in general.
Our Sep28'16 SPX bull put spread at 2110/2100 closed way out of the money today. The trade earned 8% in the two days of its lifespan.
I am likely to put some more trades on this week, especially if the SPX comes up to 2180 by Friday. I am waiting for the Put/Call ratios to give a clear bias when this happens.
