Good afternoon all -
I appreciate those of you who have stuck around thru the trials and tribulations of the current market environment paired with my extended vacation & public release of Volux. Truly, it means more than you can imagine as things have only gotten more hectic on my end while I put my best foot forward for you each day in regards to idea generation, flow analysis, and providing you with the tools necessary to be successful in any given market.
As a thank you for your support over these last two years, to those of you who did stick, and even those who didn’t (at some point down the road you supported me and I can not thank you enough), this letter in its entirety is free, for all of you. It’s a small way to show how much you mean to me, and I truly hope we can connect more as we continue this journey together.
Needless to say this has been one of the more challenging markets in recent memory, and for some of you, the most challenging market you have ever experienced if you have not been around for too long. My message here, is that it isn’t you. The struggles of the whipsaw action based off of recycled headlines, constant whirlwinds of news, price upgrades/downgrades & macro headwinds present in this current junction are vastly complicated for any unexperienced trader to navigate easily.
The constant pressure on the mind to feel like you must trade the market is not only natural, but in many ways wrong. You have all heard me and many other traders across whatever platform you may be involved on say, “Cash is a position” is very much so real and adequate the last few weeks. Options prices have been jumpy to say the least and in such cases, hard to maintain a quality level of profitability. In this time we have dialed back our leveraged exposure tremendously and have since stuck with equity / common stock buys & sells to better position ourselves for the constant volatility. When there is edge, flow, and theme, we strike and strike fast.
With that being said, let’s talk a little bit about what we have done since my last post.
Majority of daily operations have since moved fully into the discord while we merge our latest product development, Volux into the substack subscription. The two remain separate - yet both provide access to the same end point. Discord… Here.
We have a major announcement in regards to partnerships and new faces joining us here at Volux/Unusual Flow and I look forward to welcoming these new team members with open arms. More on that next week.
For now let’s talk about Volux itself as some of you may not be fully aware of what we are truly building each day.
The all-in-one platform. This ‘idea’ started as one thing and one thing only. With one simple goal in mind to track Unusual Flow’s performance YTD against the broader market. That was it, just a basket tracker. Shortly thereafter it became one “what if” after another, where we continued to build our backlog of ideas & adaptations to truly make this a full blown product (this was never the end goal..)
Here are some of the tabs and videos displaying them.
Stocks itself, the entire market in one section at your click.
Moving on, we have our Flow Pulse. Basically an entire section of deep dive into options flow and sectors with top opportunities from the session.
Let’s say you really like the look of how much premium any of those names are seeing that day, you click into it. Simple right? Takes you to another tab entirely, the contract lookup. Essentially every single thing on the platform is a doorway, to another piece of information, to best educate you on what is truly going on.
Then of course, what we have been doing here for over 2 years now, our options flow. Live updates every second, no refresh button on the entire website because nobody wants to be beholden to an extra click.
This is just the tip of the iceberg really. There are so many other features and tools present on the website that I won’t display today but let you find on your own while we continue to work on new additions and developments behind the scenes.
One of my personal favorites, and really the biggest thing I wanted from this whole experience once we opened the can of worms, literally, was a terminal. The terminal itself allows you to custom build your own screen with any tab combination from the platform all in one place. Whether that be our flagship AI Agent Bloo, or options flow, breakout scanner, squeeze scanner, charts with our very own indicators exclusive to Volux, and many more at your finger tips.
Agent Bloo section itself was not really put on display here - though is our flagship agent for the site and will only continue to improve upon itself. If you are not familiar with tracking options flow and or sifting through thousands of line items, Agent Bloo takes care of that for you with constant filtering and pulling of flows that meet the criteria I would typically send you throughout the day. Alongside this, it includes any relevant news, headlines, or releases with a simple button to view the contract as a whole.
Anyways, that’s enough about Volux for today. Feel free to ask me any questions in chat, the comments, or my DMs on X as I would be more than happy to discuss.
Let’s dive into the market. WOOF!
SPY has been in a tremendous range of chop. As I touched on earlier, constant pressure from all things news & macro giving traders & investors alike a false sense of worry. Not much has generally changed in the grand scheme of things if you really give it the long horizon view that assets need for execution. People love to overcomplicate and exaggerate the true complexities of everything day to day and pretend like they’re an expert of all things Hormuz when it suits their engagement & clicks. I’m here to tell you that it’s really not that complex. This brings us back to the obsession of the constant need to be positioned in a levered asset for getting rich quick, bonk. Trust the (your) process, and the work you put in. It is very likely that you are not wrong, just misguided and/or early.
QQQ on that same front, though significantly more volatile, is more of the same. The whipsaw levered is what you see here. Wider range, bigger ADR’s, and more drastic tape bombs as we learn more and more about AI each week & its capabilities towards society. All things considered, the opportunity is continuing to expand as compression leads to expansion.
“There is always a bull market somewhere.”
Some names held up significantly better than others, while the crowd favorites became warzones outside of the Middle East, famously coined as Nasdaqistan! We like to have fun here. Either way, and again, the opportunity continues to grow.
IWM itself took quite the beating surrounding fed decisions and cut vs hike arguments the last couple months yet we find ourselves at quite the inflection point with the 50wk SMA & previous ATH support. Small caps are by all means DUE for the larger rally, though have their own constant battle with macro headlines & environmental factors at play.
It is always nice to find pockets of strength among weakness and this will surely provide such a haven when the time rolls around if not a broader “everything rally”.
This next portion will be written by our Volux Agent Bloo, in the beta stages of production and review for public release, only a snippet however as I don’t want to give everything away today in one read.
From Bloo
Tuesday looked strong on the surface. The S&P 500 rose 0.60% and the Nasdaq 1.18%, led by chips after a $63 billion financing for Broadcom hardware leased to Anthropic. Underneath, it was narrow: 235 S&P 500 names rose and 246 fell.
Small caps were the tell. IWM closed at 280.15, through the 278.33 long moving average that capped it on Monday. That’s the first sign the bid is spreading beyond megacaps.
The flow was more cautious than the price. Calls made up about 60% of the $37.77B in premium on Volux Flow Pulse, but the side-aware read, which accounts for whether trades hit the bid or the ask, leaned bearish at 41 out of 100.
The largest position I flagged was $16.9M of Cadence (CDNS) January 300 puts, bought in two waves into a 6.5% post-earnings pop. In TSM, December 430 puts and 440 calls were both bought on the ask, with put premium outweighing call premium about 3.3 to 1. That looks more like protection on the semis run than a directional bet.
I’d like to once again, give thanks to all of you who have supported me over the last two years of this adventure. What a ride it has been and I look forward to what comes next with the astonishing community we have built, brick by brick.
Cheers,
Jersace