A lot of traders are still licking their wounds from 2025.
They chased Nvidia above $130, levered up on AI small caps that had no business trading at 20x sales, and got clobbered when the rotation kicked in.
Others tried shorting Tesla in late November, only to watch it rip almost $60 in their faces in less than two weeks:
The speed of these moves was unforgiving — up and down.
But that’s what happens when people over-extend into a hot tape.
Now, even though the indexes have stabilized, sentiment hasn’t.
Traders are nervous, and those jitters are starting to show up in the options market.
Premium is getting bid up fast and we’re seeing IV spikes on basic headline risk.
That means emotion has a chokehold on logic …
And it’s exactly what I like to look for.
Panic Button Engaged
This kind of skittishness tends to exaggerate things.
Stocks are whipping around and options aren’t just expensive near events — they’re overpriced, even on chop.
The key is to take a measured approach and structure your trades around fear.
Even the big boys are playing scared.
You’ll see a stock drop 3% on a minor guidance cut, and suddenly the options chain is pricing in another 10% collapse.
That’s not rational.
But it is a gift.
If you know how to measure your risk, you can pick off that premium like low-hanging fruit.
Choppy, uncertain, jittery markets are the best time to trade options because people overpay when they’re nervous.
And 2026 is shaping up to be one long anxiety attack.
Fear and Greed
Your edge is in recognizing when the market is blowing something out of proportion, then stepping in while everyone else is curled up on the sidelines.
All you need is for sentiment to stay twitchy.
Right now it is.
If you’re the type of trader who can think clearly when others can’t, this is your market.
Emotional moves are still giving us setups with 3:1, 4:1, even 5:1 payoffs — without swinging for the fences.
This is where professional traders press calmly and consistently.
That’s where real money is made.
Stay Street Smart,
Jeff Zananiri
*Past performance does not indicate future results
