Some stocks just got a lot cheaper. I believe we saw the wipeout of some momentum traders with their stop-loss orders. I increased the GS call position yesterday during the carnage. As per usual in these situations the implied volatility spiked and it is arguable a better strategy to sell puts. I was somewhat disappointed by today's action as we didn't get a follow-through today from yesterday. Disappointed because I was eyeing some more opportunities. That said we might very well see more weakness ahead.
Notable is that commodities are holding so well through all this. Crude was up for most of yesterday and finished today close to $62.
Another encouraging sign is that the USDJPY remained relatively strong, particularly today. It is much talk about the so called Yen carry trade in the media. It is probably a good thing that everyone is aware of the risks of this trade.
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