Trading UVIX for Effective Hedge📊 Trade Idea: UVIX Multi-Layered Entry Strategy (Scalping Volatility Spikes)
The current market environment presents a unique opportunity to trade the Volatility Shares 2x Long VIX Futures ETF (UVIX), which has surged nearly 50% on Thursday and 124% over the last week. With ongoing fears surrounding President Trump's reciprocal tariffs, volatility is expected to remain elevated.
🔍 What Is UVIX?
UVIX is a leveraged ETF designed to provide twice (2x) the daily return of the Long VIX Futures Index. Unlike the VIX itself, which measures expected market volatility, UVIX holds futures contracts on the VIX, aiming to profit from both upward spikes in volatility and the structure of the futures market.
Pros of UVIX:
High Return Potential: Can deliver significant gains when market volatility spikes.
Effective Hedge: A powerful tool to offset losses during broad market declines.
Liquidity: Offers easy access to volatility exposure without directly trading VIX futures.
Cons of UVIX:
High Volatility: Amplified moves can result in large gains or substantial losses.
Decay & Compounding Issues: Daily rebalancing and futures roll costs can erode value over time.
Not Suitable for Long-Term Holding: Designed for short-term plays, not buy-and-hold investing.
Here’s my detailed risk-managed trading plan to profit from continued volatility.
🚀 Entry Strategy: Layered Buy Entries with Trailing Stops
🎯 Initial Entry:
Entry Price: 80.00 (Just above the breached Supply Zone 0: 56.80 - 66.38)
Stop Loss: Below the lower trend line from the recent parabolic move (For example, around 70.00).
📈 Position Scaling: Adding to Winning Positions
Use Buy Stop Orders:
As the price breaks above significant supply zones, place Buy Stop Orders to add positions.
Scale in positions at:
Level 1: Above 89.20 (Top of Supply Zone 1)
Level 2: Above 113.25 (Top of Supply Zone 2)
Level 3: Above 147.24 (Bottom of Supply Zone 3)
Level 4: Above 182.36 (Bottom of Supply Zone 4)
Manual Entries:
Alternatively, you can manually add positions on strong breakouts during or outside Regular Trading Hours (RTH) to catch volatility spikes.
!!!Use Limit Orders Outside RTH!!
Place limit orders during off-hours to capture sharp volatility moves when liquidity is lower.
Market volatility often increases during pre-market or post-market sessions. Capitalize on these moves with well-placed limit orders.
🛡️ Risk Management: Trailing Stops & Break-Even Protection
Initial Stop Loss:
Set below the lower trend line (e.g., 70.00). This provides a wide margin for market fluctuations while still protecting your position.
Trailing Stop Loss:
As the price progresses upward, move your stop loss to higher levels to secure profits.
Use a dynamic trailing stop that follows major support levels or recent lows.
Break-Even :
Once UVIX has moved 10-20% above your entry point (80.00), move your stop loss to break even (80.00) for a risk free trade.
📌 Profit Targets
Target 1: 130.79 (Historical 350% level from July 2024 move)
Target 2: 165.46 (Top of Supply Zone 3)
Target 3: 210.30 (August 2024 High)
Adding positions as the price moves in your favor allows for maximum profit potential while limiting risk on initial entries.
Moving the stop loss to break-even creates a risk-free trade, allowing you to ride the momentum without worry.
Continually adjusting stops protects profits as they accumulate, ensuring that gains are secured even if the market turns sharply.
📣 Final Thoughts
The Volatility Shares 2x Long VIX Futures ETF (UVIX) is a powerful instrument for profiting from short-term volatility spikes. Given the current geopolitical and economic uncertainty, this setup offers a strong risk-reward opportunity.
💡Advice: Avoid Greed & Gambling in Volatility Trading
Trading the Volatility Shares 2x Long VIX Futures ETF (UVIX) offers tremendous profit potential during periods of heightened market volatility. However, the same leverage that can generate huge gains can just as easily cause significant losses. Avoiding greed and gambling behavior is crucial for your long-term success.
UVIX trade ideas
UVIX...the gift that keeps on givingWith all the inflationary measures taking place and ultra high valuations, we are bound to see a very nice uptick in volatility. There is some nice upside to grow here so let it breathe. It could easily go beyond $33 range.
All the best and always do your own due diligence!
VIX / UVIX....awesome upsideSo far VIX / UVIX has not let me down and with all the issues in the market it is statistically well positioned to go up IMHO. Great returns are only for those who take calculated risks. The China and Tech topics among pending liquidity / interest rate issues can all lead to massive volatility. Also, in the mix ridiculous high valuations that will "correct" very soon.
All the best and always do your own due diligence!
Traded UVIX This Morning, Just After Open. Position Closed NowIs CBOE:UVIX right for you? Would you also like to earn when the market is down? If so check it out, I traded $UIVX right after the open and have already closed the position. I usually don't day trade, but on a down day like today I couldn't resist trying the downside with Ultra Short Futures Options. These instruments aren't for everyone, & most people who own them lose money over time, so please be careful and only risk as much as you can afford to lose.
UVIX (VIX) will spike Mon / TuesWe're only seeing tip of the iceberg! The tariffs will come in over the weekend and the market won't feel it until early in the week. Expect many companies to be impacted, which will result in major volatility. You have a great opportunity here. I made 8% on this today, and there is a ton more to go. If you'd picked it this morning when I posted, you'd have gained!!! A lot more goodness here....
Best of luck and always do your own due diligence!
VIX play....UVIX up up and up!!!!The tariffs will come into effect this weekend and it's 100% inflationary. Interestingly, the VIX is at a very low price atm with the new President. The VIX spikes a lot and this is a wonderful set-up (easily 20-30%) potential upside. Use UVIX ETF to take this, and after market closes it typically spikes a lot more. I think over the next few days we'll see a very nice healthy jump.
VIX has never disappointed me! Always do your own due diligence, but this is looking rather sweet!!!! Best of luck, it will likely spike Mon / Tues by a lot
VIX is the clear winner (UVIX)VIX made a nice spike over the weekend and we can see that volatility is back on the table with this administration. Do yourself a favor and look at this baby! Literally the easiest trade you will ever make. Follow SMA 10 on the 30min chart. Don't buy until SMA 50 is positive and close to the close price!!!!!
Looking to share the love and even if you lost on other trades, this is looks real sweat. Trade your rice and beans for a nice Argentinian steak with chimichuri!
Always do your own due diligence and best of luck!
Sell the Inauguration VIX-SPLOSION price discoveryDemocrats left Trump with a front loaded yield curve time bomb where only a 30-40% (S&P500) can bring down the 10 year treasury 200-300bps to a long term sustainable level. They did this on purpose and quietly and Janet Yellen was the orchestrator. So, it is what is it and no fixing it so might as well make it a trade. Sell the inauguration ("news").
Disclaim: Not advice. For Advice, advise an advisor. Past not equal future, duh! Investments into funds that manage VIX derivatives bring additional risks and require acute real-time monitoring for this is like playing with dynamite (been advised).
UVIX had a nice run, but it's over nowUVIX had a nice spike and hope that everyone took advantage of my earlier call on this baby! Now the party is over and we're off to the next party with SVIX (inverse)! Nice set-up and primed for a nice jump since we reached the tip of UVIX. Best of luck and always do your own DD!
Pullback will be spectacular UVIX...enjoy!History can indeed repeat itself. Hopefully folks enjoyed their 20%+ profit I called out earlier. If you didn't sell, no worries, the upcoming spike will more than make up for the weak hands that profited off small gains versus seeing the bigger opportunity could be over 100% easily.
Best of luck and always do your own due diligence!
VIX swing nicely set-up with UVIXSuper pumped by this upside of this set-up with VIX. Note that VIX is for sport vs. UVIX futures, but they typically align on the spikes. Do your own due diligence, but note the nice curve showing a bounce from the bottom / support level. RSI and key TAs validate bottom although there could be some volatility, but seeing where the market is and selling pressures across the board this seems like it's nicely set-up for a nice spike. Belated Xmas present!
Best of luck!
Grab the horns on this massive upside VIX (UVIX)I've been keeping my eye on this beauty! The price seems to be right and primed for a nice hike. I use 30min chart and 10SMA along with other indicators. It appears there's a nice support line that has been passed along with other TAs esp. if you're looking for an entry point. There could be some waiting, but I've seen that these hike very quickly so you may want to have it in your wish list.
Best of luck and always do your DD!