Vanna Rally, Vanna Crash – Now You’re Just Making Stuff Up, Right?!
(6 min read)
My wife is an ardent fan of the Macro Hive WhatsApp group. It’s got some very bright minds exchanging ideas and analysing the daily happenings in the marvellous world of high finance and petty viruses. The other day she was following a thread discussing the almost-miraculous day end rally after the currently en vogue 1000-point downside gaps…
Of course, possible explanations are plentiful: the rather mundane usual end of day short covering, the frantic reaction to the latest comments of some central baker, and even the manifestation of hopeful revaluation of first movers and the associated end of the correction. That was when a man of my liking, a derivatives trader, dropped the V-word, leaving a super-smart investor scratching her head. His question to the chatroom was whether the rally in the last hour of trading might have been a Vanna Rally. And it caused a spirited discussion among those in the know.
At this point the phone was handed to me with instructions to read the thread, and then came a request: explain! I did, and my wife’s response has become the title of this article.
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