Good Morning,

There's blood on the saddle. The good news is that things were much worse overnight than they are now.  Stress Tests? Yeah, right. Brexit. That'll leave a mark. Who's next? Italeave, Czech-out, Finnish, Departugal, or maybe Oustria. Time will tell ... and rumors along these lines will move asset prices.

The financial sector (XLF) will be the hardest hit today, as drastically changed currency exchange rates and compressed bond yields are taking their toll. By the way, your penny no longer buys one yen. Central bank intervention? We've already seen it from the SNB. Don't be surprised to see it as well from the BOJ.

The US dollar index is back below 96, which is what we want to see. Anyway, now you understand why I practically begged the Fed to normalize three years ago when they probably could have pulled it off. Hope is not a very good policy.

Adding to our mix today, will be the Russell (^RUT) re-balance, which standing alone without a global financial markets crisis, would cause today to be the busiest day of the year at the NYSE in terms of trading volume. Now, with that volume, you'll have extreme volatility.

What can you, the trader, do? Well, if you did buy those July FBP 140 puts that we talked about yesterday, then you've already played some pretty nice defense. Maybe buying some long dated calls for the same underlying ETF isn't such a bad idea today. Just don't pay more for the premium that what you lock in on the put side.

Question: Why is the prime minister of the UK hanging around til October? Thanks for your service. Now get out of the way ... and let the next guy or gal invoke Article 50 as soon as possible. Who needs the increased uncertainty? There is already too much of that.