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Stocks are stalling on Tuesday, although a steady decline in December Fed rate cut odds continues to develop in the background.

Stocks are stalling on Tuesday, although a steady decline in December Fed rate cut odds continues to develop in the background.

In today's Options Trading Concepts Live, Mike, Jermal and Thomas Westwater analyzed copper's potential for a major upside move in 2026, noting that the copper-gold ratio has reached extreme lows not seen since the COVID recession. The International Copper Study Group forecasts a deficit of 150,000 tons by 2026, a significant shift from earlier surplus predictions. Supply constraints from major miners like Anglo-American and Freeport, combined with rising demand from electrification and AI data centers, create bullish conditions. When the copper-gold ratio reaches current levels, copper historically outperforms gold by nearly 20% over the following 60 days. The hosts established bullish positions with HG calendar spreads and gold call diagonals. Other markets discussed included natural gas's seasonal strength (up 4.5% today), livestock's volatile trading patterns, and Micron's challenging options environment amid semiconductor volatility.

In today's Options Trading Concepts Live, Mike, Jermal and Thomas Westwater analyzed copper's potential for a major upside move in 2026, noting that the copper-gold ratio has reached extreme lows not seen since the COVID recession. The International Copper Study Group forecasts a deficit of 150,000 tons by 2026, a significant shift from earlier surplus predictions. Supply constraints from major miners like Anglo-American and Freeport, combined with rising demand from electrification and AI data centers, create bullish conditions. When the copper-gold ratio reaches current levels, copper historically outperforms gold by nearly 20% over the following 60 days. The hosts established bullish positions with HG calendar spreads and gold call diagonals. Other markets discussed included natural gas's seasonal strength (up 4.5% today), livestock's volatile trading patterns, and Micron's challenging options environment amid semiconductor volatility.

Market Insight: SPX Traders Report Put Buying Activity Amid Volatility Yesterday saw significant put-buying activity according to SPX traders on the Cboe floor, with many traders selling "cheap puts" as hedging strategies shift. The accessibility of 0DTE SPX options has transformed hedging, allowing investors to purchase short-term protection more affordably than longer-dated options. While bonds are closed for Veterans Day, futures continue trading electronically. The S&P 500 remains down around 20 points following Monday's rally, which was partly fueled by speculation about potential rate cuts in December. CoreWeave (CRW) emerged as a trading opportunity after falling 15%, prompting the hosts to establish a position by selling puts at the $75 strike. The trade reflects their preference for defined-risk strategies in volatile conditions while waiting for potential government shutdown resolution.

Market Insight: SPX Traders Report Put Buying Activity Amid Volatility Yesterday saw significant put-buying activity according to SPX traders on the Cboe floor, with many traders selling "cheap puts" as hedging strategies shift. The accessibility of 0DTE SPX options has transformed hedging, allowing investors to purchase short-term protection more affordably than longer-dated options. While bonds are closed for Veterans Day, futures continue trading electronically. The S&P 500 remains down around 20 points following Monday's rally, which was partly fueled by speculation about potential rate cuts in December. CoreWeave (CRW) emerged as a trading opportunity after falling 15%, prompting the hosts to establish a position by selling puts at the $75 strike. The trade reflects their preference for defined-risk strategies in volatile conditions while waiting for potential government shutdown resolution.

This Market Measure segment explored the relationship between theta and vega in options trading, revealing counterintuitive dynamics in high IV environments. Analysis of SPY strangles from 2020 to present demonstrated that high IVR trades benefit from both faster time decay and reduced volatility risk. Key findings showed 16-delta SPY strangles have higher initial theta and lower vega exposure when volatility is elevated. The presenters explained that although selling premium during high volatility seems counterintuitive, these trades benefit from exaggerated fear pricing and positions being farther out-of-the-money.

This Market Measure segment explored the relationship between theta and vega in options trading, revealing counterintuitive dynamics in high IV environments. Analysis of SPY strangles from 2020 to present demonstrated that high IVR trades benefit from both faster time decay and reduced volatility risk. Key findings showed 16-delta SPY strangles have higher initial theta and lower vega exposure when volatility is elevated. The presenters explained that although selling premium during high volatility seems counterintuitive, these trades benefit from exaggerated fear pricing and positions being farther out-of-the-money.