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VIX: Record net-short options (fundamental analysis)Although we primarily trade FX contracts, staying on top of the equity markets around the world can have huge advantages when trying to identify opportunities preparatory to them even showing validity. The CBOE Volatility Index, known by its ticker symbol VIX, is a popular measure of the stock market's expectation of volatility implied by S&P 500 index options. Put simply, this chart represents volatility in the most widely used benchmark in equity markets (SPX). As you can see, over longer term time frames price has compressed. This can be proven by looking at the average true range indicator (ATR) and historical range percentage indicator (HRP) on the daily timeframe. You will see levels very low; significant because the last time these two indicators were this low on the daily chart the VIX was prior to big spikes in volatility. These are incredibly complacent and quiet markets. There's nothing wrong with equity markets hitting new highs, however the more risk-appetite that traders have in their books and the further it deviates from what we would construe as a well founded risk position. Traders are carrying assets this high up in the market know that their exposure at these prices is risky. This is more of a risk when you consider the representation of volatility seen in the chart above. Looking at futures for the VIX, there is a net short position on the derivatives currently not expired. What's significant though is that the amount of contracts net short is 218,000 a new record. This shows the willingness of the market to take on risk through leverage. Keep in mind, the amount of free cash for Wall Street is at record lows, as the complacency of it itself can be seen just by considering this fact.
TVC:VIXLong
by UnknownUnicorn3442968
11
EG: 4-hrly long-setupAfter a -8% downtrend from Aug 19 through todays currently traded prices, we can look at the well proven level of 0.85 as current support to be respected. This potentially could be the bottom we are waiting for for an entry, but we won't know any time soon. We are however looking for a long entry today, as the 0.85 continuously is subjected to being rejected following price testing it. As always stoploss, entry, and targets are provided live when we enter the trade on our end. Stay tuned to our telegram channel for updates. Keep in mind that it's thanksgiving.
Long
by UnknownUnicorn3442968
5
DXY: New ATH or a retracement lower? Nov. wk 3It's important to keep in mind previous price action when trying to assess both a currency pair and it's index at the same time. Let's not forget the freefall from the current all time highs through to 97, a drop of 2.5%. After last weeks run up through both of our targets, we are now expecting a retracement within the current structure for the DXY. We expect one of the fibs to go inline with the monthly resistance level of 98.5 to provide us some nice targeted entries. Thus, our bias is neutral as there remains upside potential on the 4-hrly timeframe, where we can use the zones drawn in the chart to cororelate with our USD/xxx and xxx/USD based trades. Looking at the weekly timeframe, we can see very choppy price action that continues to maintain it's bullish long term price action towards our target established back in May of 100.
TVC:DXY
by UnknownUnicorn3442968