Verified Investing on $SPY (Nov 6, 2026)

Anyways, I'm looking at the spiders today. We saw one of the worst sell-offs yesterday, down 4%. But after the midterms posted, traders were chasing calls. We came down, we broke a trend line, looking like the spiders were going to break down.

And then the midterms posted and traders started trading calls and were pushing up. Now, then the next day, we plummeted down. Then traders started to buy those puts or they had bets in the options market.

The market was going to go down on this red bar. That's not the time to buy those puts. Now you're paying an increased premium on those puts and everyone's buying insurance still to the downside.

So yes, when we have sharp falls like this, this gives price action sharp bounces and I think that will happen intraday. However, I do still think that there's going to be another leg down based on the options sentiment.

So first off, two key levels I'm watching. There's a big call wall or uh of heavy traders here at this pivot right here about 740. This was support on the way down. Now it's going to be resistance on the way up should we bounce.

Right now we're at about 7355. That was about the institutional average or VWOP yesterday going into the close. If there's another leg lower, I'm looking at this red bar candle here at about 72914.

Uh, this low pivot here should give a bounce. Should we continue lower?

But you say, Jake, why do you think that we're going to continue on lower? Well, the VIX, baby. Look at the VIX. We shot up 70% yesterday. We have not seen this since the peak of the US Iran war.

All right. Now, this was on March 3rd. And as we see today, we closed above this kind of 23 24 level. So right now the VIX is at 27. There is still plenty of fear in the market.

Regular day traders are still buying protection or puts for further downside. Now look here. This is March 3rd when fear was elevated 26 27 levels. All right. Now let's go back to the spiders.

Let's zoom out. This is March 3rd right here. Sorry about that. This is March 3rd right here. Yes, we did get a slight bounce. that relief bounce that you expect in the spiders with that fall, but we still edged down.

This is the whole time as that fear was elevated, price kept going down as fear stayed elevated. So, until the VIX comes back under this 23 level, I still think spiders are going to have another leg lower.