I believe this may be developing an “expanded flat” for blue “b.” As I’ve mentioned, “B-waves” are inherently difficult to predict. In these (expanded flats), orange “b” first takes out the high of blue “a,” but then goes on to take out the low of orange “a.” It may take out the prior high at green 4 (red arrow), clearing any liquidity up there (but we may not get that high). I will monitor these developments as we go.
On the open, I intend to close a majority of the calls from my SPY strangle (which will now be ITM if we open here), I will average down the put side, and I will take a few shorter-term puts as well. (I am also in the process of trying to fade this on futures, but will discuss that in more detail on the Discord server).
So, that’s the thought for now.
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