Why did we have October stock market sell-off and what next?

A crowded short in VIX futures, a rare “VIX up while stocks up” divergence, and an overbought S&P 500 set the stage for October’s shakeout. Whether we get another leg down hinges on whether VIX holds.

Chinese tariffs weren’t the cause—everyone knew they’d eventually be rolled back. They were just the trigger.

1) The setup: a record crowd shorting volatility

The short position in VIX futures has been…