The S&P 500 and the ETF tracking it, State Street SPDR S&P 500 ETF Trust (NYSE:SPY), experienced a historic bout of intraday volatility on Monday as a sudden military victory claim from President Donald Trump triggered a massive short-term rally, even as the broader market breached a technical level that historically precedes a bear market.
A Historic Options Squeeze
The most dramatic action occurred in the options market. By 2:10 p.m. ET, with oil prices near $120 a barrel and the S&P 500 down over 2%, the $675 strike SPY call options had withered to just $0.02 per contract.
However, the market inverted instantly at 3:20 p.m. ET following comments from the White House. By 3:30 p.m. ET, those same calls were trading at $4.95—a staggering surge of 24,650% in roughly 80 minutes.
According to data from The Kobeissi Letter, a $1,000 investment at the afternoon low would have grown to $247,500 by the close.
This post was originally published here
