Aspen Analytics
Six bid at a half. Six bid at a half. Goldman coming in with a hundred on the offer. Morgan Stanley has been buying all morning.
That was the sound of edge in the late 1990s.
When I was scalping NYSE stocks electronically from our office in La Jolla, CA, we had an audio feed from the S&P futures pit in Chicago. Ben Lichtenstein was the caller – the man whose voice became the heartbeat of the market for a generation of traders. He’d string together price calls, broker identities, crowd noise, and order flow into a continuous read of what was actually happening in the pit. Goldman on the bid. Morgan Stanley on the offer. Locals have been selling all morning. You’d weave those threads together and arrive at something you couldn’t see on any screen – a real sense of how the pit was positioned and where price was likely to go next.
We weren’t trading S&P futures. We were reading them. The pit was the related market. Knowing whether Goldman had been buying all morning told you something meaningful about whether you wanted to be long or short a NYSE stock in the next ten minutes. One market confirming – or contradicting – what you were seeing in another. That was the edge.
The pit is gone now. But the principle hasn’t changed.
Friday offered a modern version of the same idea. VIX climbed steadily throughout the session as SPY pressed to new lows, eventually reaching 15.91 – a key structural level. That marked the session low for SPY. VIX reversed off 15.91, and SPY rallied roughly 6 points. By late session VIX had retraced all the way back to 14.69 – another structural level. That marked the high in SPY, from there it drifted off into the close.
Two related markets. Two structural levels. Two clean turning points.
This isn’t about VIX specifically. It’s about the same thing Ben Lichtenstein was doing from the floor – reading beyond the price pattern directly in front of you to understand what a related market is saying at the same time. When the inputs align, you have something. When they don’t, you wait.
Trading price patterns in isolation was a limited approach in 1998. It’s a limited approach now. The instruments change. The principle doesn’t.
The levels referenced here are part of the Aspen S/R framework.
For those who never heard the pit in its prime – check out this Ben Lichtenstein recording. It sounds like nothing else in finance.
Reflections from a long career in trading.
Aspen Trading Group is a registered Commodity Trading Advisor (NFA #0576114). Nothing published here constitutes trading advice.
