Bump in the Night - VXX Similar looking chart pattern in VXX just prior to big spike. Divergence indicator recently went bullish.
Not financial advice.
VXX
Vix 46?Not a bad day of work, my friends. Congrats to those who stuck it out and caught the breakout! Respect.
By Request - EW for VXX (Inverted Scale)VXX is an interesting chart for EW analysis.
Sometimes I will invert the VXX chart to analyze wave counts from that perspective.
My count has VXX ending a significant 5 WAVE down from the Spring 2020 high - soon and potentially as soon as next week! Probably an early call as WAVE fives can extend out and out and out …sometimes. And I will note that (inverted) VXX broke through the 1.618 Fib last Friday with conviction after several previous tries.
I'm currently long a few June 18 NS calls.
Not financial advice.
VIX UP!VIX - Looks like a bottom has formed... Compared to last run up in late January 2021.
Big Wave E UP on deck per my count.
Not financial advice.
S&P500 Elliot Wave CountLooks like we're at the end of the road, my friends! ABC correction will commence any week now.
VIX ready to goVolume today and this past week on VXX has been significantly higher, showing accumulation and bullish divergence. Significantly oversold now I think the issue with options today or not knowing about the reverse split pulled in a ton of shorting which should add a short squeeze catalyst to a rocket fueled takeoff. Biden set the primer with a higher tax increase, new bad news will be the trigger and there is plenty of it out there.
On the SPY weekly front we see a massive inverted hammer, RSI of 72 as well as a market outside of its bollinger band. The monthly looks like a blow off top and RSI is currently 73.5 - it is also pushing outside of the bollinger bands. We have not seen the market this overbought since 2018 right before that massive end of year correction. The market is currently priced well beyond perfection and we are now 2.9 standard deviations above the average on the Buffet Indicator, inflation is already running rampant, the fed continues to pump liquidity into markets and ignore the risk it is creating and the bubbles forming on nearly every asset front - a phenomena I dub the "everything bubble." I do not expect this to be THE crash, which I think will come later this year, but we should be looking at a pretty serious correction and I would think a VIX of around 30.
Feel free to agree or disagree in the comments. I have been wrong and lost a significant amount of money going long VXX and UVXY so far this year, so do not take this as financial advice, but the ingredients seem just about perfect for a large VIX jump.
UVXY Double Up to $10?UVXY looks poised to double in the immediate term to a 10 handle. Let's see if we get a Vix breakout (above 19.70) by the close of trade today. We'll need to see it hold for the previous resistance level (18.80) to act as support going forward...
SPY is about to pop!This is the weekly chart for SPY.
As you can see its Overbought on all 3 major indicators.
This explains why VIX is increasing.
Please be careful as the markets are very volatile right now
Vix Ready for Lift OffVix is seeing consecutive rejections at the 21 day EMA, which is sitting just below a previous support level turned resistance. If we see a breakout above this level today, we have initial upside to the 50DMA around 20.9.
$40 million bet on Vix going to 25, then to 40"One or more traders laid out a roughly $40 million bet that the Cboe Volatility Index - often called Wall Street's fear gauge - will break above the 25 level and rise towards 40 by mid-July," finance.yahoo.com
Try to play it with VXX for 1x leverage to the vix and UVXY for 1.5x leverage to the vix. It is a good way to have some volatility protection.
Vix Could be Hinting at a Replay of 2010Let's take a look at the Vix with a Heikin Ashi candlestick, and on a log scale. Notice the RSI on the monthly timeframe is 43, after hitting a similar RSI high in March 2020 (80) to that of Nov 2008, when the RSI was around 80 as well. The post November crash RSI low in the Great Recession crash was around 40, and we're at 43 now on the bounce. In 2010, abruptly following the 40 RSI test, we saw the RSI rise back toward 55, taking the Vix from a low of 15.20 to a 48 handle in a matter of weeks. Here we are, after the Major crash of 2020, and Vix is back at a 16 handle, with an RSI of 43. What might happen next if we see a notable correction, is an overcorrection, which could easily take Vix back to 48 based on previous market behaviour and sentiment, post crash. I don't see Vix having more than a 1 point downside at this stage, so I may consider increasing my position yet again, in anticipation of a large spike back to the 40's as early as this month. Thoughts and ideas welcome.
Stocks Rally on Positive Data, as Money Now Grows on TreesWe're seeing a massive landslide of wins across the economic data spectrum this morning, with Retail Sales coming in hot at 9.8% vs the 5.3% expected, Retail Sales ex-auto coming in at 8.4% vs the 4.9% expected, jobless claims coming in at the lowest level since before the pandemic at 576k vs the 695k expected, and finally continuing claims came in at 3.73MM vs the 3.72MM expected. We'll see Industrial Production at 9:15AM, as well as Capacity Utilization. Isn't it interesting how quickly those stimmy checks made it to families, and then went straight out the door? So, no what? We're gonna need another stimmy cheque asap!
After some light weakness to end the trading day on Wednesday, followed by some further weakness in the overnight session, futures are skyrocketing higher on the positive data prints. As of 9AM, the S&P was trading up around 0.65% to 4,141.75, the Dow up 0.50% to 33,784, the Russell up 0.80% to 2,262.70, and the Nasdaq up 1% to 13,940.25.
Gold, Silver, Platinum, Copper, and Palladium, were all higher on the day, as the dollar burns to the ground on perpetual easy monetary policy, and "free money" fiscal policy.
The Vix is back near the post March crash lows, and is trading around 16.8 as of 9AM. We're seeing the most vicious decay in risk protection I've ever seen in my career. Risk is a bad word, and has seemingly been cancelled by Wall Street. Let's see how this progresses as Main Street lines up again with their hand out, for another round of stimmy cheques.
According to Goldman Sachs, “We are probably entering the last stage of the pricing of the growth acceleration, and we see encouraging signs suggesting the ‘reflationary’ environment can continue and be supportive for risky assets in the near term." This comes after Goldman, JP Morgan, and Wells Fargo posted stellar quarterly results. Wall Street is just loving this bail out. They're simply never held accountable for their actions and their systematiclly threatening and reckless derivatives behaviour.
European stocks were mixed this morning with the Dax up half a percent to 15,264, the CAC40 down 0.64% to 6,170, and the FTSE up 0.69% to 6,941. In Asia, the Nekkei 225 was up 0.36% to 29,718, while the Hang Seng was down by 0.30%, and the CSI was up by 0.78% to 4,979.60.
Considering we're sitting at the ATH's, it appears we're in for another day of sideways PA, with markets having no other option but to catch all that free money, and levitate yet again. Stay patient as the ponzi nears the end, and free money begins to put pressure on the Fed to hike rates sooner than "expected".
Our live analysis begins at 9:30AM! Cheers, Michael.
*I am/ we are currently holding positions in UVXY, HQD, QID.
UVXY - Entropy, Gravity, and LightIdea for UVXY:
- Attached is Fundamental Analyses.
- We do not expect UVXY to reach $1.00 before the reversal of the greater trend.
- Why would Volatility enter an increasing trend? We expect global economic contraction, before stagflation, then finally deflation.
GLHF,
DPT
Disclaimer:
We absolutely do not provide financial advice in any shape or form. We do not recommend investing based on our opinions and strongly cautions that securities trading and investment involves high risk and that you can lose a lot of money. Loss of principal is possible. We do not recommend risking money you cannot afford to lose. We do not guarantee future performance nor accuracy in historical analyses. We are not registered investment advisors. Our ideas, opinions and statements are not a substitute for professional investment advice. We provide ideas containing impersonal market observations and our opinions. Our speculations may be used in preparation to form your own ideas.
Concerning Vix Patterns and a way to profit it from itThere appears to be a pattern forming that cycles and could signal a pop or swell in the vix. With the way the geopolitical landscape has been, I would assume it would be a pop based on a certain piece of news or an event. A swell would be more worrisome for the overall market. There was a great post here and I can't remember who posted it, forgive me, but they had a great explanation of how a vix pop is a buying opportunity, while a vix swell is a warning sign.
A cool way to play volatility is through investment vehicles such as VXX or UVXY. VXX is not levered while UVXY is levered to the vix by 1.5x. My preference is to play it with UVXY, but that's just me and my risk tolerance. I like to build up a position slowly as the chop continues all the while having a limit sell in for a reasonable level in order to catch gains on a red day if I'm not tuned in. The other cool part about using this as volatility dampener in your portfolio is that on those sh*t show days, you actually have some buying power to harvest with out locking in any unnecessary losses or having to harvest gains from one of your most beloved long-term holds or just a position that has not hit your price target yet.
VIX Futures Price Curve Vs. VIXSimple enough.
The market is showing extreme divergence between Futures contracts priced for next month, and Futures contracts priced for Q4.
This is the largest divergence seen within this Futures cycle.
My theory is that it could be indicative of a bottom in VIX and the market pricing for more serious volatility events later in the year.
Key:
Bolder, lighter lines: Near-term
Finer, darker lines: Longer-term
This utilized VIX futures priced between next month and November.
I just wonder what the headlines are going to say.there's a slim chance that we go slightly higher.
pt: 2941.00 ~ 2686.00
this was a fun run, but it's time we reset some rsi's and start fresh 💸
Volatility Creeping AgainAnticipate more red next week (sometime around Tue-Thur). Might get a little rallying Friday and Monday.
OPENING: VXX MARCH 19TH 13/16 LONG CALL VERTICAL... for a 1.50 debit/contract.
Notes: With VIX at lows, opening a small risk one to make one bullish assumption trade in VXX with a 14.50 break even.
I generally don't like to take bullish assumption shots in volatility products, particularly ones like VXX and UVXY that experience contango erosion over time, implying that you're rowing against the tide with any bullish assumption directional shot. Looking to get .75 out of this if the opportunity presents itself.
Broadening Megaphone SPY and Inverse VXXI inverted the VXX and analyzed the mood sentiment shift in 2016 when investors felt safe to invest post 2016 you can see the exact months when the agreement was brokered and VOL was sent downwards (upwards on the inverted chart). Both SPY and VXX are broadening - "Broadening formations occur when a market is experiencing heightened disagreement among investors over the appropriate price of a security over a short period of time".
This is clear as the US10Y yields continue to stabilize and get ready for another leg higher.
We can see higher highs and higher lows on the inverse VXX and now we see massive divergences on this as we are clearly moving towards the broadening pattern instead of downtrend on the VXX.
(Please understand the VXX was inverted to make this easier to see)
Please like this chart if you found it useful!
alternative scenario for the quad witching on 3\193\19 max pain is at 376 as of today, i do expect it to rise up around a dollar or two by then.
look for a clean 5-3-5 correction leading into next friday to finish this wave 2,
then the real fun begins :]
i'm a big buyer next friday, but until then i'm either short or in cash.
trade safe peoples, and don't forget that the witches are coming ;)
VIX putting in the most tremendous coil into falling wedgeThis is going to be a big move up, get long vol right now!
VOLATILITY - $VIX - Q1-Q2 Bullish Elliot Wave ForecastJust working on the forecast model. Practice makes perfect. This is my bullish Elliot Wave Forecast.
I think bullish (for VIX) - just look at M1 for a start, but there is more investigation to be done...
However:
“The test of a first-rate intelligence is the ability to hold two opposed ideas in the mind at the same time, and still retain the ability to function.” - F. Scott Fitzgerald
Always need to have multiple threads in order to survive any sort of market or economic condition!
Should we minimize damage, or is the best defense a good offense?
GLHF
The Great BounceChart self explanatory.
We are going to new highs, the wave barely getting started. Same ol same. Market has spoken
