This episode of The Opex Effect breaks down why markets have remained surprisingly resilient despite geopolitical chaos, an oil shock, and extreme headline risk. Brent Kochuba joins Jack Forehand to analyze what’s really driving the market beneath the surface—from options flows and gamma positioning to the collapse in volatility and what it signals for the next move.
They explore how the options market is shaping price action in ways most investors miss, why the VIX collapsed despite elevated risk, and what positioning tells us about the path forward as we head into earnings and the next major options expiration.
Topics covered:
Why markets have stayed near highs despite war, oil spikes, and macro uncertainty
The “taco trade” and why investors expect bad news to reverse quickly
How options flows and dealer hedging are influencing stock prices
Why call options are historically cheap heading into earnings
The mechanics of gamma, delta hedging, and market maker positioning
Why options expiration (OpEx) can act as a turning point for markets
The divergence between oil prices and equity volatility
What the collapse in the VIX reveals about investor positioning
The role of zero-DTE options in reinforcing short-term market ranges
Key resistance levels forming from call selling and what they mean for upside
Timestamps:
00:00 Why markets aren’t reacting to geopolitical chaos 04:18 The “taco trade” and shifting market expectations 07:30 How options flows influence stock market movements 11:10 Why OpEx can drive market turning points 13:05 Volatility compression and the gamma-volatility relationship 15:30 How large options positioning shapes market behavior 18:05 Why positioning has shifted toward calls 20:00 Why this OpEx may be less impactful than prior ones 22:00 Market positioning into earnings and key drivers ahead 24:10 Using gamma maps to identify support and resistance 27:00 Revisiting the JP Morgan collar trade and March lows 30:00 Correlation spikes and the oil-volatility relationship 33:00 Why oil has stopped driving equity volatility 34:30 The breakdown between oil and VIX correlation 36:00 Why volatility may reprice higher after OpEx 37:05 The oil curve and expectations for a short-term shock 39:40 One of the largest VIX collapses ever 41:00 How options positioning drove the volatility unwind 43:00 Why selling volatility has become a dominant strategy 45:00 The feedback loop between rising markets and falling volatility
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