June 18th, 2026 LIVE TRADING | Triple Witching Day: Options Volatility & Setups to Watch

Key Concepts

• Market Catalysts: Fed policy (FOMC), geopolitical tensions (Iran ceasefire), and triple witching (simultaneous expiration of stock options, index options, and index futures).
• Semiconductor Strength: The "AI infrastructure stack" (Micron, ASML, AMD, Intel) continues to lead market rallies, defying traditional cyclicality.
• Volume Profile: A tool used to identify high-volume nodes (areas of acceptance) and low-volume nodes (areas of rejection/fast movement).
• Liquidity Sweeps: Trading strategy focusing on sweeping prior day highs/lows to identify true breakouts versus false moves.
• Unbalanced Butterflies: A defined-risk strategy involving a butterfly spread combined with a short vertical, often used in high-IV environments to generate credit.
• Real Yields: Treasury yields adjusted for inflation; rising real yields are currently acting as a headwind for gold and silver.

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1. Market Overview and Catalysts

The market is experiencing a robust rebound, driven primarily by the semiconductor sector. Despite a 1% sell-off following the FOMC meeting, the NASDAQ and S&P 500 have reclaimed losses.

• Oil: Prices have faded by ~2% as reports indicate Saudi, Qatari, and Chinese ships are transiting the straits, signaling that the "war premium" is being removed.
• Triple Witching: The hosts emphasize that today’s price action is heavily "flow-driven" and mechanical due to the triple witching event and the upcoming Juneteenth holiday, which may mask broader cross-asset signals.
• Divergence: A notable disconnect exists where stocks are rallying while the US Dollar (DXY) remains strong and gold/silver prices are declining, suggesting the stock rally may be more technical than fundamental.

2. Trading Methodologies and Frameworks

• Volume Profile: Forest Knight (FKX Capital) explains that volume profiles identify where "business is done." High-volume areas represent price acceptance, while low-volume areas indicate fast movement.
• Liquidity Sweeps: Knight defines these as sweeps of prior day highs or lows. He suggests that if you want to bet on an upward move, you should look for a liquidity sweep on the downside first to ensure there isn't a "magnet" pulling the price lower.
• Risk Management: The hosts and guests advocate for "dynamic risk" rather than fixed-percentage risk. As a trader develops, they should size positions based on the trade thesis and market volatility (ATR) rather than a static dollar amount.
• Unbalanced Butterflies: Tom Preston (TP) explains that these are effective in high-IV environments. By dragging one strike of a butterfly to create an "unbalanced" structure, traders can generate a credit and eliminate downside risk.

3. Sector Analysis

• Semiconductors: The hosts argue that the semiconductor industry has shed its "boom-bust" cyclical reputation. Due to the strategic importance of AI compute, these stocks are now treated as essential infrastructure, similar to national defense or energy.
• Gold/Silver: The consensus is bearish for the near term. Rising real yields and a strengthening dollar are creating a difficult environment for precious metals.
• SpaceX: The stock is identified as a "flavor of the week" ticker. While highly volatile, the hosts suggest waiting for the initial hype to settle before establishing long-term positions.

4. Notable Quotes

• On Risk Management: "You have to actually have a trade thesis that works in your favor... if you trade half a percent risk every trade and lose every trade, you’re not a good risk manager, you’re just losing money a little slower." — Forest Knight
• On Market Sentiment: "The market doesn't care about diplomacy. It cares about the actual movement of the flow of oil." — Chris Veio
• On Trading Psychology: "The first thing you have to be comfortable with is losing... it's the tuition that you're paying in order to be successful." — Jessica Ramos

5. Synthesis and Conclusion

The market is currently in a "melt-up" phase led by AI infrastructure, despite broader macroeconomic headwinds like rising real yields and a strong dollar. The primary takeaway is that traders should remain disciplined by using technical levels (like yesterday's FOMC highs) to validate bullish bets. While the "June Swoon" seasonality and triple witching flows are creating noise, the underlying strength in semiconductors suggests that the momentum trade remains the dominant force. Traders are advised to focus on defined-risk strategies (like unbalanced butterflies or put spreads) to navigate the volatility while maintaining a long-delta bias until the market proves otherwise.