Market Volatility Update The volatility just keeps expanding! The intraday trading ranges for SPY last week were: Monday: 17.44 Tuesday: 13.14 Wednesday: 11.80 Thursday: 10.05 Friday: 11.76 Weekly High-Low Range: 27.22 With such massive swings, it’s no surprise that backwardation in the VIX futures became even more pronounced. But can volatility keep expanding indefinitely? Two major economic reports are set to hit the market within 24 hours of each other. Key Economic Events Ahead 📢 CPI Report (March 12, 8:30 AM ET) PPI Report (March 13, 8:30 AM ET) If these reports show even mild inflationary pressures, the Fed will struggle to justify rate cuts. On top of that, the ongoing tariff uncertainty isn’t helping stabilize the market. Expect heightened volatility around these key data releases. Options Market Insights Last week's at-the-money SPY straddle was priced at 11.80, which turned out to be a bargain given the realized volatility. Looking ahead: The SPY 14Mar25 576 straddle is priced at 14.90 If volatility keeps rising, this could also be a bargain If the market takes a breather, it could spell trouble for long-volatility trades Trade Idea of the Week Trade Setup: Long SPY 14Mar25 571-576-581 Call Butterfly @ 0.45 Reasoning: Playing for a volatility crush post-CPI/PPI With implied volatility elevated, this negative gamma position allows for a cost-effective way to capitalize if the market stabilizes after the inflation reports. Want to take your options trading to the next level? My personalized mentorship program is designed to help you develop a structured trading approach, refine your strategy, and navigate the markets with confidence. Spots are limited—start your journey today! Click here to learn more and schedule a session. — Dan Keegan