Selling premium right now but not really loving it

I’ve been staring at this vol setup all week and honestly it’s one of those times where every signal is fighting every other signal.

VIX is down to 19, vol of vol is normal, everything on the surface says “sell premium and collect theta.” And I want to. The VIX curve is in steep contango with short-term vol sitting way below longer-term. That’s basically the market paying you to be short. That’s my bread and butter.

But here’s what’s bugging me.

SKEW just hit 157. That’s institutions quietly loading up on crash protection while the headline numbers look calm. They’re not hedging because they’re scared today. They’re hedging because they think the Iran situation could go sideways fast. I respect that trade.

The other thing keeping me honest is that I ran the numbers and options are genuinely underpriced right now. SPY implied vol is around 14.8% but the actual moves printing on the tape are closer to 20%. So every time I sell a condor I’m charging less than what recent history says I should. That’s a negative risk premium and it makes me uncomfortable.

What I’m actually doing:

Iron condors in SPY, 30 to 45 DTE where the contango carry is fattest. Tighter wings than I’d normally run. I’m leaving money on the table and I’m fine with it because if realized vol stays hot, wide wings are what blow up your month. I’m also not touching anything far-dated. The back of the curve is pricing in months of uncertainty and I don’t want to bet against that.

What’s really got my attention though is bond vol. MOVE index is at 74 and climbing while equity vol drops. That disconnect bothers me. The bond market is basically saying “we don’t buy this Iran de-escalation story” while stocks rally on it. In my experience when bonds and stocks disagree I listen to bonds.

I also noticed put/call ratios stayed heavy across the board on a green day. SPY at 1.83, IWM at 2.5. The big desks bought the bounce but kept every hedge on. That tells me this is a relief rally, not a real turn. Fear and Greed at 41 confirms it. We’re still in fear territory despite the green.

Honestly my conviction on this is maybe a 4 out of 10. The carry is there and the structure makes sense but I can feel the market sitting on a binary outcome that could flip everything overnight. So I’m sized small, defined risk only, and ready to take the condors off early if bond vol keeps climbing.

Not trying to be a hero here. Just grinding the edge and staying small until something resolves.

Anyone else finding it hard to get comfortable selling vol right now even though the contango is screaming at you to do it?