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VIX CBOE Volatility Index

The Exception, 11 May 2023🖼 Daily Technical Picture 📈 ➤ SeePI is out of the way and we are pretty much none-the-wiser. TLT representing long-term interest rates remain in a range and not giving anything away, equities is also trapped in a range. The only exception is the NASDAQ, it has broken above a trading range. ➤ Will it remain the exception? It may do as long as broad markets trade sideways or well supported. I doubt it will continue to outperform if markets begin to fall. ➤ In last week's daily note I talked about topping formations in the SPY in recent times. Currently, the price is testing the high. A failed test of the high (meaning we don't see a new high but a lower high) would be the likely trigger for a reasonably sized fall. ➤ Conclusion: 🐆 Stalking my prey... EQUITY TREND: ⦿ Short-term (weeks) - NEUTRAL ⦿ Medium-term (< 6 months) - UP ⦿ Long-term (>6 months) - DOWN
AMEX:SPY
by mrstockyetoro
UVXY Volatility Index ETFUVXY as shown in the 15 minute chart is slightly above the basis line on the Bollinger Bands as shown also on the BB indicator or Luxalgo. Price is slightly below the mean VWAP of the anchored VWAP situated in the fair value area as also confirmed by the volume profile and its POC line confluent with the VWAP bands. Given impending federal data reports and news, I expect volatility will rise. UVXY could have positive price action in the range of 10% in tomorrow's trading day which can be day traded or scalped.
AMEX:UVXYLong
by AwesomeAvani
Sell in May, 10 May 2023🖼 Daily Technical Picture 📈 ➤ Yawn!!! 🥱. That's all for today's description of price action. See you on SeePI Wednesday... ➤ Now I fully comprehend the adage "Sell in May and Go Away". Because nothing happens in May. May as well cash out and earn some juicy returns in a money market fund at 4 or 5% pa. ➤ Let's see if CPI numbers present some volatility (and oh that debt ceiling drumming is getting louder too) ➤ Conclusion: 🐆 Trading is 99% boredom EQUITY TREND: ⦿ Short-term (weeks) - NEUTRAL ⦿ Medium-term (< 6 months) - UP ⦿ Long-term (>6 months) - DOWN
AMEX:SPY
by mrstockyetoro
SeePI, 9 May 2023🖼 Daily Technical Picture 📈 ➤ Equities changed little on Monday trade. It is probably digesting the price reactions from last week. It is also probably awaiting to see the CPI numbers on Wednesday. The data is released pre-market 1hr before US open so we may see some positioning ahead of the inflation number during Tuesday trade. ➤ To be honest I'm not expecting too much action on Wednesday either. This is because prices are trading within a range and I don't think the ranging activity is done. Furthermore, there is a distinct lack of movement in TLT, the 20yr US bond ETF. This is either because no one knows what's going on with interest rates over the long-term i.e. buyers/sellers are equally opposing each other or they think interest rates will stay at current levels for the foreseeable future. The comfounding economic data certaintly points to the latter. ➤ I'm yet to get a trade signal. We are confined to the sidelines until then. I'm hoping the CPI numbers will provide us with a trade opportunity. ➤ Conclusion: 🐆 Trading is patience. EQUITY TREND: ⦿ Short-term (weeks) - NEUTRAL ⦿ Medium-term (< 6 months) - UP ⦿ Long-term (>6 months) - DOWN
AMEX:SPY
by mrstockyetoro
🟩 VIX is continuing to improveVIX DROPS SIGNIFICANTLY 📉 The VIX has experienced a dramatic decrease, which is crucial to observe as we shift from a bearish to a more favorable market. Similar to what occurred in December and at the start of the year, the 28 level serves as a warning signal, particularly after a substantial market movement. This indicates that the market may be overheating, and we should be on the lookout for a potential bear market. Throughout the recent bearish phase, the VIX remained elevated above the 28 level. SEEKING LOWER LEVELS 🎯 Ideally, we'd like to see the VIX return to lower levels. While occasional upticks are expected, it's important that they remain within the lower historical ranges. Lower volatility benefits the indices, but it's equally important for individual stocks to exhibit reduced volatility as wel
TVC:VIXLong
by TintinTrading
Dec VIX closing is very, very important!Monthly line charts are so simplistic; yet so important to analyze. If you've read my previous DOW posts you know we are closely following the 2000-2002 bear market cycle vs. any other bear market and this chart further confirms my thoughts. Notice how the VIX today (2017 to present) vs. the VIX 1994-2000 timeframe is diverging with the S&P. Both are making higher highs and higher lows until something breaks. In the 2000-2002 case we had the dot com bust (Rate of Change in very high risk/internet stocks plummeted) while today we have the Bond bust (Rate of Change within the bond market has plummeted). Towards the end of the VIX/S&P divergence (in the 2000-2002 case) the VIX ended up remaining "in trend" while the S&P lost about 46% over a 2 year period (see below chart). The VIX remaining "in-trend" for such a long period of time was a warning that something was going to break at some point and the indexes eventually lost a fair amount of value over a 2 year period. In sum...my thoughts: If we close Dec VIX below the blue dotted; Oct low will hold If we close Dec VIX above the blue dotted line; Oct low will NOT hold.
TVC:VIX
by Vixtine
38
Neither Here Nor There, 5 May 2023🖼 Daily Technical Picture 📈 ➤ Another day down, you'd start to think it's becoming a trend. It may be the start but as for now I've downgraded the Short-Term equity trend to Neutral - meaning it's trendless, neither here nor there. The reason for the trendless tag is that we have experienced a higher high and lower low in recent days - a mix of opposing trend definitions. ➤ Note the price gaps all over the place as indicated by the blue arrows. Today's price gap in the SPY warns of that "acceleration" top formation I described in yesterday's post. ➤ Interestingly, both my Primary and Secondary strategy gave exit signals and this has been executed. I currently hold no positions. It is reflective of the opposing forces. This was a nice hedge that helped to protect capital and delivered on the "diversifying" benefits of incorporating both strategies. ➤ Still, we suffered a loss on this hunt and we go hungry. The price action is developing into a familiar structure. If it plays out our way, I think we won't go hungry for long. ➤ Conclusion: 🐆 Trading is a battle between feast and famine. EQUITY TREND: ⦿ Short-term (weeks) - NEUTRAL ⦿ Medium-term (< 6 months) - UP ⦿ Long-term (>6 months) - DOWN
AMEX:SPY
by mrstockyetoro
Topping Formations, 4 May 2023🖼 Daily Technical Picture 📈 ➤ Equities continued to sell-off but not aggressively. It wasn't the kind of impact we have had on previous interest rate decision days. That being said, futures are down further in Asian trade. ➤ Let's have a look at the last couple of topping formations of the SPY at previous peaks in Dec 2022 and Feb 2023. If we have just witnessed another peak we might be able to gain some insight on how this may play out in the immediate future. ➤ We saw two types of topping formations. Dec 2022 was a double-top with a failed upthrust at the second peak. Feb 2023 was a common topping process where there was a failed re-test of the high. ➤ The current "assumed" peak could be a replay of either scenarios as described. It can also be a third process where price continues to fall without any attempt to re-test the high. The price action signals a "rush for the doors". This is less common. It would be similar to the Aug 2022 peak. What we should expect to see is price gapping lower to reflect an acceleration downward. ➤ I remain long with a small position. ➤ Conclusion: 🐆 Have we peaked? May the 4th be with You. EQUITY TREND: ⦿ Short-term (weeks) - UP ⦿ Medium-term (< 6 months) - UP ⦿ Long-term (>6 months) - DOWN
AMEX:SPYLong
by mrstockyetoro
Bring Back the Vol, 3 May 2023🖼 Daily Technical Picture 📈 ➤ Sharp drop in equities accompanied by a spike in the VIX. It seems the market didn't like the taste of abnormal low vol. It wanted things to get back to "normal". As a Trader, "normal" is good although sometimes we end up on the wrong side like today. Bring back the Volatility. ➤ The Strategy did as it should by halving the position size yesterday in anticipation that some level of downside may occur. I cut my long position further today upon another exit signal. My secondary strategy signaled a short trade. Overall I have a small long position going into US Interest Rate Decision/FOMC day. ➤ Before you ask, I have no view on the outcome of the interest rate decision and what may or may not happen. I don't spend much time on those fundamental aspects of the market. There are plenty of talking heads that will offer their opinion but only listen to those people who actually have a wager on the outcome. I wouldn't trust anyone who doesn't have skin in the game. ➤ Conclusion: 🐆 Looking to recoup some losses EQUITY TREND: ⦿ Short-term (weeks) - UP ⦿ Medium-term (< 6 months) - UP ⦿ Long-term (>6 months) - DOWN
AMEX:SPYLong
by mrstockyetoro
GOLD VS VIX -3/5/2023-• Gold is highly benefitting from the fear and uncertainty in the market which is likely to persist • Markets are again assuming a recession coming • Banking sector latest dilemma is adding to the fear sentiment • Rising interest rates, hard landing caused by FED continuous tightening policy along with signs of stagflation all add to the bullish price action seen in the commodities markets • Added the VIX (volatility/fear index) below Gold chart to try and visualize any correlation between them • Interesting to see that peaks in VIX index were usually accompanied by peaks and rallies with the Gold • As we are approaching the all time high at 2070 with price currently just above 2000 I would like to add my own interpretation on that • When Gold traded at 2070, VIX value was around 33 • We are only just above 2000 and the VIX is way lower than the previous higher level • If current factors and sentiment persist in the market, we might see the VIX trading back towards higher levels, sending the Gold way higher than 2070 • Note that VIX is up almost 11% in a single day at the time of writing Traders, if you like this idea please comment and like ✅ Here to answer all your questions, Good luck
TVC:GOLDLong
by RamziAbouAbdallah-CMT
Reversal Time? 2 May 2023🖼 Daily Technical Picture 📈 ➤ An attempt to break above the Feb high fell flat. Literally. Equities ended where it started, slighty down from Friday close. It isn't a good look. ➤ Over the last few days, there has been a deceleration in the up move evidenced by the smaller candle sizes or price bars. It's like a car decelerating towards a known barrier ahead. It isn't confident that it can crash through the barrier or maybe it doesn't want to at all. ➤ I'm not here to question the car or in our case the market why or why not. I am here to best respond to what I can see from a short-term technical trading perspective. I therefore have cut my long position back to a moderate size. The chances for a price reversal is much higher and managing that risk is essential. There is still enough risk on the table to make good profits if the car decides to crash through but the car may indeed decide to go in reverse. ➤ Conclusion: 🐆 Perhaps this prey is too big to take down. EQUITY TREND: ⦿ Short-term (weeks) - UP ⦿ Medium-term (< 6 months) - UP ⦿ Long-term (>6 months) - DOWN
AMEX:SPYLong
by mrstockyetoro
🔥 Another Market Crash Coming? VIX Says YES 🚨The VIX is the volatility index of the SP500. Generally, it trends up during bearish times and trends down during bullish ones. In the past, the VIX has always spiked up during a market bottom. Looking at the chart, we can see that the VIX has not spiked up yet and formed a bottom like it has done in the past. We only have ~30 years of VIX data, but it has still signaled the bottom of every bear market (-20% decline or more) during that time. Assuming that the VIX is correct, there's still a chance that the market hasn't bottomed yet and that the "real" crash is yet to come. What do you think? Is the bottom in? Crash incoming? Share your thoughts🙏
SP:SPXShort
by FieryTrading
13
$SPY - Pivotal Week ⚠️ AMEX:SPY experienced a significant sell-off at the beginning of the past week, followed by a strong bounce near YTD highs. Undeniably, technicals appear bullish due to the strong bounce, particularly with TVC:VIX volatility subdued. However, given the upcoming #FOMC and NASDAQ:AAPL ER, I'm watching for volatility to resist further suppression. This pivotal week will help determine the future price direction. The momentum we saw at the end of the week does not imply a bullish cycle, and it may continue to shake out bears as it crosses the key level around 415. A potential reversal could occur at the YTD high (near 417), especially with FOMC around the corner. This scenario isn't guaranteed, but I would caution on taking long positions at these levels. Watching for higher price discovery to offer a better risk-to-reward setup to ride into sell strength.
AMEX:SPY
by theapearmy
Banish the Bears 4ever (and a summary of other asset classes)🖼 Daily Technical Picture 📈 1 May 2023 ➤ Bullish sentiment drove prices higher once more on the last day of April trade. The momentum is building to take out the Feb high at 418.31 on the SPY. This level is important if looking at the monthly chart. A monthly close above this level will in my opinion bring about the beginnings of a longer term bull market. Will this occur in May? ➤ In the very short-term I am positioned long with maximum position size. Hopefully the bullish momentum will continue and kick start the new month on the right foot. ➤ Let's have a quick overview of other assets: ⦿ USD (daily): Winding sideways. I expect further weakening, 1.13 being the target (EURUSD). ⦿ TLT (weekly): Still range bound. I favour the long-term downtrend meaning higher interest rates. Interest rate decision this week may see prices breakout up. Downtrend remains in place unless price moves above 114. At that level, we indeed may see a change in trend. ⦿ GOLD (daily): Retracing, looks poised to take out the all time high at 2070 ⦿ NATGAS (weekly): Still unable to break above the 2.30 long term resistance zone. It doesn't look strong enough to breach the resistance. Further downside expected. ⦿ OIL (3-day): Bullish move may have peaked. If true, I expect a re-test of the low at a minimum at HKEX:64 (WTI). $64/65 is a multi-year support level. A break below would see much lower prices. ⦿ BTC (weekly): Testing, probing the long-term resistance level at HKEX:30 ,000/31,000. Price can drop further (pick your level) but the new bull trend is firmly in place. ➤ Conclusion: 🐆 The Hunt is on. EQUITY TREND: ⦿ Short-term (weeks) - UP ⦿ Medium-term (< 6 months) - UP ⦿ Long-term (>6 months) - DOWN
AMEX:SPYLong
by mrstockyetoro
Banish the Bears, 28 Apr 2023🖼 Daily Technical Picture 📈 ➤ An aggressive pump higher today in equities, undoing all the Bear's work over the previous days. The Bears are banished...or are they? ➤ It does look like one-way traffic at the moment. The Bulls have control. The only issue I have so far is their inability to close a month beyond the Feb 2023 high. This monthly high close (and there's just one trading day left this month) would in my opinion seal the deal for the long-term Bullish scenario. ➤ If this doesn't happen in April we will have to wait for May...but May is known as the month of "sell and go away". If Bears can hold out for another month, the scales may tip in their favour. ➤ I took profit on my long positions. Unfortunately, my mistake as detailed yesterday diminished what would have been a good pay-day. I hold a small long position. ➤ Conclusion: 🐆 The Hunt was part failure part success. I'm still very hungry. I'm sure my Cubs are too. EQUITY TREND: ⦿ Short-term (weeks) - UP ⦿ Medium-term (< 6 months) - UP ⦿ Long-term (>6 months) - DOWN
AMEX:SPYLong
by mrstockyetoro
Celebrating 50 Years of Equity Options TradingAmid serious pushback, Chicago Board of Options Exchange (CBOE) went live on 26th April 1973. Options are now a standard tool for portfolio risk management. Not so, back then. They were seen as gambling instruments for reckless speculators. Shortly after CBOE launch, Fischer Black, Myron Scholes, and Robert Merton provided a mathematical model for computing options prices. This Nobel Prize winning model allowed options to be priced theoretically for the first time. It was a key driver in making options markets sophisticated, more efficient and much larger. The Black Scholes Merton model ("BSM") forms the fundamental basis of options pricing. It allows traders to compute a theoretical price to options based on the underlying asset’s expected volatility. Expected volatility is referred to as implied volatility (IV). Why implied? Because it is the volatility implied from an options price given other parameters from the BSM model. COMPREHENDING BSM & BLACK76 Options have existed since the 17th Century. Option were limited to speculation and gambling in the absence of a sound and suitable pricing model such as BSM. BSM offers a mathematically sound framework to compute theoretical price of European options using five inputs: 1. Underlying Asset Price 2. Implied Volatility (IV) of the Underlying Asset 3. Interest rates 4. Exercise (Strike) Price of the option 5. Time to expiry A variant of the BSM for pricing options on futures, bond options, and swaptions is the Black Model (also known as Black76) which forms the basis of pricing options on commodity futures. BSM is far from perfect. For starters, it makes unrealistic assumptions. Such as that stock prices follow a log-normal distribution and are continuous. That future volatility is known and remains constant. BSM assumes no transaction costs or taxes, no dividends from the stocks, and a constant risk-free rate. Even though these assumptions are impractical, the BSM provides a useful approximation. In fact, the model is so commonly used that options prices are often quoted as IV. On the assumption that given IV, options price can be computed using BSM. Actual options prices vary from theoretical ones based on supply-demand dynamics and with reality being different from the assumptions baked into BSM. For instance, actual prices for the same expiry and at different strike prices have been observed to have different IV. Primarily given a higher likelihood of a downside plunge relative to upside rally. This difference in IVs across different strikes is referred to as volatility skew. OPTIONS IN SUMMARY Options involve two parties whereby one party acquires a right to buy or sell a pre-agreed fixed quantity of a stock/commodity at a pre-agreed price (the strike or the exercise price) at or before a pre-agreed future date (Expiry Date). One party acquires the right (Option Buyer or Option Holder) and the other party takes on the obligation (Option Seller). In consideration for granting the right, the Option Seller collects a premium (Option Price) from the Option Buyer. To ensure that the Seller keeps up their promise to trade, such Sellers are required to post margins with the Clearing House. Once buyers pay premium upfront, they are not required to post any additional margins with the Clearing House. Where the Option Holder secures a right to buy, it is known as a Call Option. However, if the Option Holder acquires the right to sell, such an option is referred to as Put Option. Where the Option Holder can exercise their right at or before any time before expiry, such Options are referred to as American Options. Options that can be exercised only at expiry are referred to as European Options. While exercising is permitted at expiry, these European options positions can be closed out before expiry by selling out a long position or by buying back a short position. Premiums for European options are typically lower than premiums compared to American options. COMPREHENDING WALLSTREET’S FEAR GUAGE, FADING VIX, AND VIX1D The CBOE Volatility Index (famously referred to as VIX and is also knows as fear gauge) is a real time index measuring the implied volatility of the S&P 500 for the next 30 days based on SPX Index options prices for options expiring in 23 to 37 days. There are a range of financial products based on the VIX index allowing investors to hedge volatility risk in their portfolios. In recent months, VIX has been fading into insignificance. Despite huge price moves in the S&P 500, VIX has remained staid. Why such inertia? Primarily because options markets have started to shift towards shorter expiries. Zero-Days-To-Expiry (0DTE) options now account for more than 40% of overall S&P options market volumes. These very short-dated options allow traders to express views around specific events such as monetary policy meetings and economic releases. Their popularity has increased dramatically over the past few years, with volumes today nearly 4x that of 2020. To account for this shift in market behaviour, the CBOE has launched the VIX1D i.e., the One-Day VIX. This index tracks the expected volatility over the upcoming day as determined by zero-day options prices. More on Options Greeks and Risk Management using Options in a future paper. DISCLAIMER This case study is for educational purposes only and does not constitute investment recommendations or advice. Nor are they used to promote any specific products, or services. Trading or investment ideas cited here are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management or trading under the market scenarios being discussed. Please read the FULL DISCLAIMER the link to which is provided in our profile description.
TVC:VIXEducation
by mintdotfinance