The market is pricing a $100 move for the entire week.

Five full trading sessions. 

But any data release, any headline, any tweet at any hour. And the mother of all products (S&P 500) says the whole thing gets covered by a hundred bucks.

You think that's enough? Look at what just happened.

Last week gave you two separate sessions that each moved well over $100 in a single day. The break to the upside ran about 2.4 standard deviations. It was so far outside the expected move that even a full move this week wouldn't drag you back to the upper edge of last week's range.

You don't see that often. Week to week these expected moves usually cover roughly the same territory, and this one doesn't come close.

So I'll take the over. And I'm telling you that for one reason. I don't want you selling options out here, because you will get killed.

Do the math on what you're being paid. You collect premium against a $100 move across five sessions, and the implied volatilities underneath it have exactly one direction left to go. That direction does not help you.

Selling that is asinine.

Now let me tell you something I got wrong for about twenty years.

Back in my early thinkorswim days, when I first went on the road teaching options, everything we taught as a firm was sell options, sell options, sell options. That was the gospel and I preached it.

People would come up to me after those sessions and ask the same thing every time. If everybody sells options, doesn't the market eventually get too efficient, and shouldn't you be buying them instead?

I told them yeah, eventually. Not anytime soon.

Well, here we are two decades later and that day showed up. The zero DTE world is too efficient.

Today priced in a $43 move, and we haven't covered a tenth of it, and I'm still not the guy who sells that $43. The market is efficient enough that it usually gets there.

The professionals own that game. They make a crap load of money selling zero DTE and they hedge sub-second, so they sell all the premium they want and hedge the living crap out of it. You can't do that from a retail account.

So I want to be the buyer. Buying premium means you might win one in three.

You strike out, you strike out, and the third one is a home run. That's the game I'm playing.

None of this means premium selling is dead. There are ways to sell it right now that work, just not in the near-term stuff.

Squeeze hard in one spot and another spot opens up. There's always an edge somewhere.

But if you're staring at a $100 expected move on a week that just handed you two hundred-dollar days, and your gut says sell it, stop. The problem there is the gut, not the market.

I spent fifteen years inside the brokerage business watching retail traders buy the cheap call and set a stop and hope, because that is what the industry taught them to do. Then I watched it wipe them out.

Everything I learned from watching that is written down and it costs you nothing.

===> SHOW ME THE FIVE CHECKS

To your success,

Don Kaufman