Although the relative strength of the iShares Russell 2000 Index (IWM) over the SPDR S&P 500 Index (SPY) has diminished recently it still has the advantage for upside moves.

Last week's flight to the safety of the dollar, the yen, and US Treasuries was a driven by more than just the comments of Germany's Finance Minister.

In our May 3rd post, we began exploring the concept of having an edge, or advantage and its importance in trading. Today's post looks at the edge from the options perspective.Many people are familiar with the leverage advantage of options however, some are not familiar with the disadvantages including time decay and how changing volatility influences options values.

Since our last market review, the character of the equity market has abruptly changed from a likely correction of the major uptrend to something of greater concern for the bulls.

The SPX is now in the process of making a consolidation pattern in the form of a right triangle or perhaps a rising wedge during which implied volatility is likely to remain high. For those who want to trade the swings it appears a leg down to reversal point 3 is now underway.

For those who may be looking for long ideas after the sell off here is a relative strength idea from the Options Data Analysis and Rankers & Scanners sections of Ivolatility.

What happens to stock markets, which are now dominated by mathematical algorithms (algos), when they are all programmed to do the same thing? The likely answer is – no bids.

A look at market activity from a volatility perspective

Generally, there are two categories for the word edge; one describes a physical characteristic or location, such as a sharp edge or the edge of the cliff or canyon as shown above while the other is an analogy for advantage, such as having an edge or getting an edge. In this Digest, we explore both.

Many quarterly earnings reports are now coming every day and so far, most have beaten expectations.Instead of trying to guess which companies will beat, our approach to earnings is to look for prospective volatility opportunities.

Heavily indebted Greece formally asked for help from the European Union and the International Monetary Fund.

Up until Goldman joined Greece on Friday, SPX was continuing higher with only the slightest indication of retesting support at the breakout high of 1150.45. Now all of that has changed.