 Sometimes we throw around terminology that can be confusing at first one of the questions I got today was what does long volatility mean? What's up trade hackers welcome to today's update today's Monday April 13th. Let's jump onto the platform and answer this question. So when we say long volatility basically what we're saying and I've got a chart up of the VIX basically what we're saying is if we're going to get long volatility we would want volatility to go up so if we're looking at a chart of VIX there are strategies that you could do to do so you know this is an example of just a long call not necessarily a strategy we would do but if you look at the option Greek called Vega that is the change of volatility and so if Vega is positive that means you want volatility to go up if Vega is negative that means you want volatility to contract a lot of the strategies that we use are short Vega meaning we want implied volatility to contract we like to sell premium or sell options when they're priced high when implied volatility is high and profit from them when they contract but there are also strategies such as like I just showed you the long call in VIX but another one that we actually trade quite a bit is a double calendar and I'm showing you one in SPY right now so if I set my price slice right on the current price you can see in this case we've got a positive Vega so not only do we get the time decay of theta but we also get a positive Vega meaning we actually benefit when implied volatility expands so that's all we mean by long volatility another word for volatility contracting would be short volatility so anytime in the in the trading world when we say short that means we want it to go down when we say long that means we wanted to go up another way of saying that is buy equals long short equals sell so hopefully that helps let's check out the markets overall and see what's going on today we've got about six minutes left in the cash market S&Ps down 28 they were down as much as 60-ish I believe so their losses have been cut in half retraced a little bit dows down 320 NASDAQ is actually up over a percent and the Russell's down over two and a half percent so quite a discrepancy especially between the NASDAQ and the Russell with the NASDAQ being up a full percentage and the Russell being down over two and a half percent kind of crazy there oil down just barely now this is a little bit misleading from a standpoint of if you look at the continuous contract which is the K 20 because he oils actually down about a third of a percent whereas if you look at CLM 20 for example for slash CLM 20 which is the June contract so those are the options we would be trading oils up actually about two and a half percent so little discrepancy between the expirations in oil as well now over the weekend on Sunday I believe Easter Sunday what a great Easter Sunday to be dealing with the oil agreement but apparently the whole OPEC oil situation has at least initially reached an agreement and so a lot of the country oil producing countries are going to be cutting back on production which is going to cut down on the supply which theoretically should increase the price of oil now the fact that oil is actually down a little bit today on the continuous contract but it's up a little bit about two and a half percent it was up quite a bit more but it has come off those highs so interesting movement in oil gold fairly flat bonds down about a half percent so we're continuing to see a little bit of downside in bonds which for our positions has been good and so that's what we got going on in the markets now I've been talking about specifically Ian in the ES how you know this this rally that we've seen about 25% rally off the bottoms has been a pretty solid rally I've been talking about you know I don't think we really had much above 2800 we did bounce off of that today now I'm not a big support and resistance or technical analysis type person I don't think that gives you any type of edge in trading but that was just kind of a theoretical mental line in the sand if you will and we are seeing you know bounce off that and I still think that we're gonna see some lower lows below that 21 74 level and so I'm getting questions like okay we've got trillions of dollars being pumped into this system we've got all these things going on the feds cut rate to zero you hear the kind of the cliche don't fight the Fed kind of thing in a I don't believe that at all but B if you just look at well let me let me bring it up if you just look at unemployment okay so this is a chart of jobless claims going back to the 70s and the gray shaded bars represent little spikes in the jobless claims so you can see there's a big spike there big spike there big spike in the early 80s big spike in the 90s of course after the dot-com bubble burst that we had a spike there and then the September 11th happened right after that in 2001 and then 2008 right the biggest crisis we've seen really in the markets in my lifetime and you know I'm in my early 40s so you know that was a huge spike in unemployment well look what is going on right now and this is this is the spike that we're seeing right now I mean we're talking almost seven million jobless claims already and this thing hasn't even started so you know I mean just that alone makes me pause on saying is this rally for real are we really gonna rip to new highs I just I don't see it and that I mean think about the unemployment rate and you know are we really gonna everyone just gonna go back to work as normal in a month or two if that happens if people are starting to go back to work and maybe everybody has to wear masks or whatever that looks like but think about that I mean right now the social distancing theoretically is working with the numbers starting to kind of level off as far as the deaths and cases and that kind of thing but as soon as people start getting back together I mean what says that this this virus isn't going to spiral out of control again and so that's just my thoughts I mean and and and going back to the jobless claims when you see a situation like that where you know in the biggest crisis we've seen in 2008 where is a little blip like this you know not even not even a million and now we're at almost 7 million I don't know ladies and gentlemen I just don't see that hold water as far as you know continuing this rally in the market so we will see what happens so what did we do today you know we've been talking about we've been kind of layering in some short positions layering in some positions that are gonna benefit from the ensuing potential sell-off and today and there's the closing bell today we all we did was we rolled down a couple of our short position so continuing to extend duration and keep that short delta in our portfolio and stay mechanical I mean that's what it is all about and so that's what we are doing so no new trades just kind of letting our positions work for us hope that was helpful everybody have a great evening talk to you tomorrow