Let Me Introduce Myself

Daily Pit Stop Daily Pit Stop                                                                                                      [fstp, logo, header] February 6, 2024 [op logo] Let me introduce myself Hello Traders, I am Greg Magadini, a Chartered Financial Analyst. Currently, I am the Director of Derivatives at Amberdata which acquired Genesis Volatility, the company I co-founded. Option Pit and I are partnering up to bring you the playbook to the coming increased trading and opportunities within crypto and securities associated. And the best news is - I’m not another pontificator or a theorist on crypto. Mark and I joined up because I have data analysis about Crypto that no one but the loyal folks at Option Pit will have access to. I have been active in the crypto space for ten years and trading for fifteen years. Prior to creating Genesis Volatility, I was a proprietary trader for DRW and Chopper Trading in Chicago. Here’s my mug shot [gm] So let’s talk about cryptocurrencies. Now that the Bitcoin ETFs have been approved here’s a look at the money flow in and out of these vehicles. This bar chart shows each ETF’s inflow/outflow in Bitcoin terms: [gm] Although the newly listed ETFs overcame the Grayscale Bitcoin Trust ETF (Ticker: GBTC) outflows early on, we’ve now flipped into net negative outflows as GBTC continues to bleed. For a little background, in prior years GBTC once traded at a premium over spot Bitcoin (Ticker: BTCUSD) prices. This created an arbitrage opportunity and many firms (like 3AC via Genesis Trading) to borrow BTCUSD → send it to GBTC → and hope to sell their GBTC shares at a premium over spot prices. As 3AC, FTX and other firms went bankrupt there’s been an overhang of GBTC up for liquidation. It’s rumored that FTX itself has sold about a billion dollars worth of GBTC shares since the ETF conversion. Bitcoin prices are feeling the heat, but this doesn’t seem like a very dire pullback given that spot BTCUSD prices were trading around $28,000 just 90-days ago. On this pullback, BTCUSD dipped $10,600 from its high on January 11th of $49,100 down to a low of $38,500 on January 23rd. It has since recovered back to $43,500. The options market may be showing signs of strength. As you may already know, Option Pit specializes in options and volatility. There is a measure of call and put volatility called the risk reversal skew. This compares the implied volatility of an out of the money call with the implied volatility of an out of the money put. Generally, in equities, out of the money puts carry a tad bit higher implied volatility. When the puts have a significantly higher IV it is usually because the underlying has been falling, is expected to fall, and or a news event is imminent. There is fear of the underlying moving lower, people are buying puts and the market makers need a higher price to sell them. The BTCUSD options market saw a bottoming out in the risk reversal skew, which is indicative of a slow down in downside volatility from a spot/vol perspective. This could be signaling a possible bottom is forming in BTCUSD. Currently the short-term risk reversal skew has managed to climb back near parity. [gm] This is what I am seeing in the Bitcoin options and ETFs space at this time. I will be bringing you more crypto levels, data and news absolutely free every week. - Greg --------------------------------------------------------------- [ag views, logo, header] Sector Rotation is good A lot of the market action is caught up in the Mag 7. If you have not heard of these stocks lately you are under a rock but their phoenix like rise from the ashes in Oct 2022 is nothing short of miraculous. Part of the reason is that throughout 2023 when interest rates were rising, tech earnings held their ground. Between Amazon.Inc (Ticker: AMZN), Apple Inc (Ticker: AAPL), Meta Inc (Ticker: META), Alphabet Inc (Ticker: GOOGL), Nvidia Inc (Ticker: NVDA), Netflix Inc (Ticker: NFLX) and Microsoft Corp (Ticker: MSFT) all have cashed in on the Cloud, Smart Phones and AI or at least the promise of AI. Some of that money is leaving Tuesday. [gm] A stock that is all AI is Palantir Technologies Inc. (Ticker: PLTR) and had a 27% move Tuesday. I owed some strangles in the [Easy Trade Button]( that returned 27% and more for those who held later into the day. At this point it is investing at the top that gives some people the heebie jeebies. Modified strangles are a good way to do that.  For the bull to keep roaring, the rest of the market like the Russell 2000 has to participate. There is no big tech in the Russell so it is only up 8% or so since Jan 2023. The CPI number is next week and in between I expect a lot more days to look like this. NVDA earnings are on Feb 21 st and I do expect the Mag 7 selloff to reappear a couple of times before then. - AG  [logo, pit profits] Want to find YOUR winning fit? Give our Customer Care Team a call at [1-888-872-3301](tel:/1-888-872-3301) Monday-Friday from 9 a.m. - 5 p.m. EST. Or email them anytime at [support@optionpit.com](mailto:/support@optionpit.com)  [logo, header, fvix] The Relationship Between The Vix, S&P, Nasdaq and Bonds Hey Traders! In today's video we'll cover: - How The VIX, S&P, NASDAQ and Bonds are Connected. - Some Stocks That Are Seeing Some Really Bullish Flow - Meet Me In Chicago [yt]( [Click Here To Watch The Video!]( - Mark  [frep] Chiping In with AMD Hey Trader, This week during our Ticker Highlight Show, we covered Advanced Micro Devices, Inc. (Ticker: AMD). If you don't know what our Ticker Highlight Show is, it's an extra live trading session Andrew and I host on Mondays at 10:30 a.m. ET each week for Option Pit paid traders who have an account on our Option Pit WebApp. This means they get their trade alerts INSTANTLY. If you are a paid subscriber and haven't logged in, [you can find full instructions HERE](. I suggest you do that now - because these trading sessions have been on fire. [Check out the track record right here.]( We each gave our thoughts on AMD last week in the Pit Report, and we held a live roundtable show yesterday to come up with some actionable trades for you. [Click here to watch the full show.]( (And again - to get these trades LIVE with us each Monday, [follow these instructions]( to login to the Option Pit WebApp) - Mark   [glossary, logo] There are plenty of terms in the trading world that need explaining. The Option Pit Glossary is here to help. Today's phrase is:  Commodity - A physical asset deliverable from a futures contract regulated by the CTFC. Commodities examples include gold, crude oil, and frozen concentrated orange juice. [ftsp] All the Right Options. The Option Pit Team brings more than 150 years of experience to you every day. From the trading pits of Chicago to the world's largest banks to the halls of power in DC -- they've done it all. 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