VIX News AnalysisI predict with the best probability the future trends, my ideas are reserved for the experienced trader. #UniversTrader
Vixlong
The case for VIX right now - Margin Debt down 4.3%Hi folks!
As you may know, FINRA published the Margin Debt Statistics for July the other day.
As you may also know, tops in prolonged and explosive runs in margin debt usually precede big corrections/crashes in the S&P500 by a couple of months
The Margin Debt reading was down 4.3% from July after 15 consecutive months of increase (!)
Here is my idea on how to play the situation:
The VIX (CBOE Implied volatility from Option premiums on S&P500 for the next 30 days) is currently sitting at a measly 17.12 (albeit after a massive surge from a steal of 15.22 last week) -
below its historical average of 19.52.
Now, since the margin debt very likely topped out in July and the market tends to follow suit a few months later (in addition to just about every thing else - monetary policy, delta, debt ceiling, labor exodus, inflation etc.), it is reasonable to assume that the probability distribution is heavily skewed to the downside for the time to come. Being able to buy the VIX - which is an estimate of future volatility - below its average at such a state seems worth considering.
Based on this idea, I took the liberty to create a chart marking the following - in addition to S&P500 and VIX from 1999:
(1) Tops in margin debt (Black verticals)
(2) Bottoms in VIX before crashes (Cyan verticals)
(3) Sell signals based on concurrent bearish DIV in RSI+MACD (Red verticals)
(4) Beginning of market crashes (red cross)
(5) Current VIX level (orange vertical)
As we can see, the S&P500 do usually take a big tumble a couple of months after tops in margin debt.
More interestingly is the VIX bottoms, however - the VIX usually also bottom out some time before markets crash (this makes perfect sense, as bottoms represent states of the market where very few expect volatility).
Thus, although it is hard to time the markets, this might be one of the very few really good Risk adjusted bets you can find right now.
My strategy since the end of June has been to just sell a little bit of my stock portfolio every week to buy some VIX, and then sell some VIX contracts during periods of small volatility spikes to cope with the future premiums over time. I bought a massive position on Friday and another one today due to the Margin Debt reading. I will continue to buy as long as complacency dominates the market.
On another note, I always use historical data to weight my bets according to the Kelly Criterion (ex: www.frontiersin.org)
The simplest way to trade the VIX unless you are familiar with derivative platforms is to buy ETFS such as VXX, VIXY, VOOL.DE etc*
Disclaimer:
This is not financial advice.
I urge everyone to always do their own research, and never take the word of other for granted.
In addition, never take advise from someone who has nothing to lose from giving it to you nor follow the advise themselves - that is why I disclose my positions.
I wish you all well!
Good luck :)
Wedge break out and back test or Head and Shoulders S&P500Looks pretty ugly to me. Intraday's don't look that great either. Longed UVXY looking for a quick swing. Following yields, watch TNX. If wrong, will suck, but them's the breaks.
How Stocks Can Go Up In a Bear Market.Here are some hypothetical numbers I formulated, which by the way you can take with a grain of salt. It is for entertainment purposes only.
Some Tabloids you may find interesting:
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Algorithmic trading is accounted for around 60-73% of the overall United States equity trading.
Feb 5, 2019
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Aug 4, 2020
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VOLATILITY B WAVENew all-time highs in the market combined with a creeping VIX are cause for some alarm. Inflation hedges/bets seems to be the talk of late with inflation on the rise.. and this is not unwise considering that money supply is off the chart and velocity is sure to pick up... although velocity is not a necessary component of inflation. Remember that the market is forward looking and when something becomes obvious to you, you are are usually late to that fact. I believe volatility is bottoming in this range and is very likely to start the B wave of a larger wedge. I had expected this to begin sooner. If this is indeed a new, larger wedge, then perhaps it's even bigger than I anticipated. I also believe the market is quite a ways off from any major crash like we had in March of 2020...perhaps years out. But that does not mean we will not have sharp drops with periods of volatility.. I tend to think we are nearing that now. Be on the lookout for market noise and flush-outs. There are likely to be some decent buying opportunities made available in many stocks soon. Hold fast.
VIX Intraday Week 17Be careful out there, play defensive and smart. Minor bull trend is playing out. Lots of FUD in the market, big money likes to hedge. We also have record levels of margin out there which explains some of the volatility we've been seeing. Goblins running amok.
VIX Bottom played outVIX bottom play for the next 7 days.
Don't use any technical indicator on VIX if it's too low, just move:
I don't need big timeframe to playing this out, so 7 days is far enough.
Max profit: $90
Probability of Profit: 47%
Profit Target relative to my Buying Power: 42%
Buy Power: $210 (max loss without management)
Max loss with my risk management: ~ $100
Tasty IVR: 11.3
Expiry: 7days
Buy 3 VIX Mar24' 19 Call
Sell 3 VIX Mar24' 20 Call
Debit call spread for 0.7 debit each
Stop/my risk management : Closing immediately if daily candle is closing below $19
Take profit strategy: I'm taking at the 75% of max.profit in this case with auto sell order. (at 0.95 credit)
If you liked this article, check my other ideas.
Anyway: HIT THE LIKE BUTTON BELOW , and follow my fresh ideas ( @mrAnonymCrypto on tradingview ).
☢️ 💣Market Volmadeggon: VIX – sky is the limitHi guys, is this VIX chart is like „deja vu“??
At last financial crisis at 2008 the simmilar pattern created like recent months. Treasury spread yields telling the same story again in lower pane. After first cross of its 12-month MA it takes 5 months to firs bigger surge in TVC:VIX . Then it takes 13 bars to yield spread approach to 2%, then volmadeggon begun….
The situation on chart looks familiar now...
If history repeats this time not be different but much bigger than 2008
After first cross 12 month MA of Yields spread it takes 3 bars to new higher high on TVC:VIX 37.5 in 2008. This month its 12 bars from TVC:VIX new higher high 85.5 when COVID-19 pandemy started.You can observe same massive vix squeeze as in 2008.
So its looks like this year 2021 will be EPIC & LEGENDARY in financial markets
As you notice in chart, my target is at 2.61 Fibbonacci retracement level because this level was reached at 2008 too.
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Leave a comment that is helpful or encouraging. Let's master the markets together.
ridethepig | VIX Exploding 📌 ridethepig | VIX Exploding
Morning all... a short post, but one that is full of dramatic events. The 'discovered naked short' from wsb is a wildfire burning...the cleanest place to see the damage is in vol. This discovered vector in GME clarified the damaged relationship between central banks and market pricing while QE infinity provides a cover a 'risk free' environment. It's very similar to the round trip explosion we traded last year from 12 to 85 and back again.
When you pin shorts (the root of all evil), whether its GME, BB or VIX... it has enormous mobility. The magic of reddit has exposed Melvin Capital, Blackrock (own +/- 10% of GME) et al, while Citadel cheerlead in the background and will of course be fine and make money either way.
Let us take a closer look at the possible moves with the VIX; I find that the 44 pivot which is in the crosshairs can do one of two things;
a) The offer can evaporate rather quickly, even if it was previously nailed by barrier, which will trigger a momentum gambit towards 85.
b) We can attack and our opponent (sellers) without any anxiety step back in to occupy the control since it is their jurisdiction, i.e. one ladder that is controlled by your opponent.
Now consider the latest chart update:
Here a) was very much dependent on the October 2020 highs. Bear in mind how unafraid the buyers which are moving with force are. The wildfires are capable of satisfying a healthy appetite from retailers. with that in mind we are going to see capitulation across some more names.
Thanks as usual for keeping the feedback coming 👍 or 👎
VIX "wall of fear is approaching."VIX "wall of fear is approaching." What characterizes the volatility index indicates increased activity. The analysis shows that fractal construction has taken place in the volatility index. We have reached the ascending stage of this fractal. This indicates increased price movements for different asset classes. This phenomenon indicates panic. Although it can also be seen that a few days, perhaps a week of uncertainty ensues. We can also see that this may be temporary, before another even more significant correction.
UVXY Potential This idea varies from my other ideas because I focus primarily on the fundamentals instead of the technicals.
Details are provided on chart. I plan on purchasing shares, not options, due to the low price.
From a macro perspective, this upcoming 1-3 months may possess an immense amount of volatility. I will keep this idea updated, as I don't plan on longing quite yet; I'm interested to see what the $900bn stimulus check will do. But as always, do your own DD.
Happy trading!
THE NEXT WAVE OF VOLATILITYMarket volume is drying up and we're seeing historic put:call ratio's on the indices. We have the necessary ingredients in the cake for a another wave of volatility to hit the market. Please see my previous post about the VIX and the compression patterns that often occur. Volatility tends to get bottled up and then erupt. We are likely in a bottling-up zone where fear is gone, and all is calm.. I suppose this can continue but I like to think we're nearing a volatility cycle low. I am of the opinion that the VIX is in a new, giant, price wedge. If you look at this chart, I think (a) will be tagged.. but perhaps it already has? I don't know. It could be now or it could be weeks from now. I'm speculating on the pattern some, but I will be looking to hedge my portfolio with long calls in volatility over the coming weeks.. and even months if necessary. I have learned to completely ignore mainstream news and focus entirely on the data. The math doesn't lie. People do.
Something to think about- Let's pretend I'm right about this being a new, giant price wedge. If this forecast turns out to hold water, then the market is likely to go significantly higher over the next couple of years.. I don't want to even mention numbers because this could be a big pattern. Regardless, I'm looking for the next wave of volatility to come rolling in. I've been around long enough to know that the market can creep & creep for weeks or months before pivots. Timing a market top is extremely difficult so one must not be too biased or emotional.
Another possibility: What if the VIX is already out of the cage? What if this isn't a new compression wedge? This pattern is my "optimistic" perspective for the markets.. It's possible that the vix could take off like a rocket to new highs where markets completely unravel. In time, the fundamentals WILL take over. I have no idea how much time we have.. all I can do is analyze the data.
S&P 500 - Fibonacci rejection - upside activeSPX500 needed to created a descending channel after the high to engineer some liquidity for continuation of long positions.
Where did price fall to?
Key Fibonacci 0.618 - 0.705 levels
Why is this important?
Look left - the white candle shows an imbalance on the previous bullish engulfing .
We are currently long but await the next buy from a daily low.
See the Vix vs S&P500
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Volatility Picking UpVolatility broke out in March from Covid/lockdowns. Markets have rallied since and you can see volatility consolidating back on the other side of the (now) support line.
Not a good sign for markets that are pretty overbought.
ridethepig | VIX for the Yearly Close📌 @ridethepig VIX Market Commentary 18.12.2020
A good time to update the VIX chart for the traditional Quad witching flows....After an exchange in Q1 2020 with VIX exploding to the topside as widely expected for all those following, there is now what follows, an opportunity for a panic cycle next week (21st December) followed by another window in January for the extraction. A weaker sell side has allowed the zig zag advance, buyers are threatening to decisively break the highs once more unlocking an execution at 85 for another board clear.
The position in my books is finally won by buyers, the ending will be instructive of US equities in particular. The position also has a chance of drawing at 20.0x support. While the same 85 targets (the position is an important link to the GA run off in Jan), taking the highs means we must chase and play from the centre. Buyers will wish to prove that 'resistance' is hanging by a thread, it might work.
Thanks for keeping the feedback coming 👍 or 👎
ridethepig | VIX Panic Cycle📍 The theme we have set ourselves here for an expansion in Vol into next week, would usually provide enough material for an entire website, but lack of space compels me to moderate this into a short and snappy post.
I shall only point out the most important notions and events from 2019 and save a deeper examination for later.
The most brilliant post covid act, to be sure the idea of an expansion in volatility is not only linked to the increase in danger from a health rollercoaster which I propagated, based on the models. But VIX's move is surprising and I will not deny the brilliance of the full retrace.
Also interesting is our earlier attempts to break up and make use of the flexible highs which we discovered ahead of US elections. All models are ticking up for the NY session today and looks set to last into next week. Aiming for the full set-up with 42 and 85.
It is also worth noting that 42 is an interesting defence, going on to pressurise Biden with a 'hospital pass' for those familiar with the terminology in Rugby, it is where you are so fixated on catching the ball while it is in the air, that you forget about everything else around you. This early complacency, looks as anti-pseudo-capitalist as possible, but has found a good number of followers and turned out to be an extremely fruitful trade in equities. Major chart updates coming across the board over the coming hours and weekend.
Thanks as usual for keeping the feedback coming 👍 or 👎...
