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Volatilityindex

When is VIX a buy? Is this a good time to buy?The truth is that it is a buy whenever the VIX gets close to 20. Since November, and especially since the war in Ukraine broke out, I've said that the VIX below 20 is a steal. The VIX has just had a mini jump because of Pelosi's visit to Taiwan, but if nothing happens between the US and China, it could fall lower. Personally believe that stocks have another 7% higher to go, which could crush VIX below 20 for a while. However, I think this would be a bear trap and a great opportunity for bulls to go through long volatility. In the short term, stocks could correct a bit more before going higher, which could cause the index to go up a bit, though I don't think a big breakout or anything like it is coming. My long-term goal (6-12 months) remains 45-50 on the index, but it needs some time to get there, and it must inflict even more pain on all those who have been holding puts over the last year.
TVC:VIX
by BitcoinMacro
Time To Buy Some New Shorts. VIX To Bounce Upward.VIX trading in a bullish pennant pattern. We have seen two really nice bullish bounces off the support trend line in this pennant pattern. I expect this next support line touch to be nothing different (assuming VIX touches support). VIX targets: 25.41 resistance first, then follow-through to 28.93, eventually reaching the top of the upper bound of the pennant pattern around the 33 area. With that in mind, I am beginning to load up on short positions and closing out some of my higher beta long positions. This is not trading advice. Good Luck!
TVC:VIXLong
by Gooby_Trades
4
The New Base Level in the VIX IndexThe VIX index is the Chicago Board Option Exchange’s CBOE Volatility Index, a popular measure of the stock market’s expected price variance of S&P 500 stocks. The S&P 500 is the most diversified of the leading stock market indices. Higher base levels in the stock market’s volatility index A correlation with the bond market Markets across all asset classes face many issues in 2022 As market participants head for the sidelines, volatility increases The buy zone for the VIX is the 20-25 level Market volatility comes in two forms, historical and implied. Historical volatility measures a market’s past price variance, while implied volatility is the consensus perception of the future price variance. The primary determinate of call and put options is implied volatility. Options prices rise when implied volatility increases and falls when the measure declines. Options are price insurance, and market participants tend to flock to the options market during bearish periods. Therefore, implied volatility tends to rise during downside corrections. In 2022, the S&P 500 has been trending lower, and volatility has increased from the levels seen in 2021. Meanwhile, the VIX index has been trending higher since reaching a low of 8.56 in November 2017. Higher base levels in the stock market’s volatility index The VIX index has been trending higher over the past five years, with two significant upside spikes. The chart highlights the spikes to 50.30 in February 2018 and 85.47 in March 2020 when the global pandemic gripped the stock market. Meanwhile, the base level for the VIX was around the 10 level from April 2018 through early 2020. In 2020 and 2021, the base rose to the 15 level, and the bottom for the VIX increased to the 20 level in 2022. In the VIX, upside price spikes tend to signal the kind of capitulation that leads to stock market bottoms. While all the leading stock market indices have been declining in 2022, the price action in the volatility index has yet to signal stocks are anywhere near the bottom. A correlation with the bond market Stocks and bonds compete for capital flows. As interest rates rise, money tends to flow from equities to fixed-income securities. Therefore, a falling bond market is bearish for stocks. The trend of higher lows in the VIX is a bearish sign for stocks and bonds. In 2022, the stock market has traded like a whack-a-mole game. While making lower highs and lower lows, declines have led to rip-your-face-off rallies, confusing market participants. However, the overall bearish trends in stocks and bonds and bullish trend in the VIX index is a sign that the bear continues to dominate the markets. Markets across all asset classes face many issues in 2022 Higher interest rates are bearish for the stock market and bullish for the volatility index. However, the markets face a lot more than higher interest rates in 2022: The war in Ukraine creates a unique side of problems for all markets. Rising energy and food prices have pushed inflation to a four-decade high, translating to pressure on stocks and bonds. The Fed’s interest rate policies remain far behind the inflationary curve, keeping real interest rates in negative territory and fueling even more inflation. The bifurcation between the world’s nuclear powers creates trade issues that distort prices, creating raw material shortages in some regions and gluts in others. The tensions interfere with the flow of goods worldwide. The mid-term US elections in November will determine the balance of power in the House of Representatives and the Senate. The election will be a barometer of support for the Biden administration. Polls point to losses for the ruling party, but the electorate remains divided, with emotions high on both sides. Voters tend to vote with their pocketbooks, but there is much at stake in November. US energy policy continues to address climate change by favoring alternative and renewable fuels and inhibiting the production and consumption of fossil fuels. The President recently said the pain of higher gasoline and fuel prices is necessary for consumers to shift to a greener path. Opponents contend that the energy shift will take decades, while supporters argue that hydrocarbons continue to power the world. The election will go a long way to deciding if the US continues its green route or shifts back to a drill-baby-drill and frack-baby-frack road to energy independence. Russia and Ukraine export one-third of the world’s annual wheat supplies and a significant amount of corn and other agricultural products as they are Europe’s breadbasket. Higher food prices and scarce availabilities over the coming months and years could spark a period of upheaval with hungry people in less developed countries dependent on Russia and Ukraine facing famine. These issues and the unknown are fueling uncertainty in markets across all asset classes with no solutions on the immediate horizon. Uncertainty is the stock market’s worst enemy. While the Fed attempts to address inflation with interest rate hikes, supply-side economic issues could mean the central bank is fighting an inflationary blaze with a water gun that will only hasten a recession or worse. As market participants head for the sidelines, volatility increases Market participants are nervous in June 2022. The price for all goods and services continues to increase as money’s purchasing power declines. Moreover, after the stock market gains over the past two years, monthly IRA and investment account statements are eroding at an accelerated pace. As of June 16, the tech-heavy NASDAQ had lost nearly one-third of its value from the late 2021 high. The S&P 500 was down more than 22.8%, and the Dow Jones Industrial Average fell around 17.5%. Consumer confidence has plunged, and a general disgust and malaise are settling over markets across all asset classes. Rapidly rising interest rates are making new home purchases prohibitive, even if prices come down. Meanwhile, we are heading into the peak summer months with the stock market in whack-a-mole mode. The odds favor a retreat to the sidelines for many market participants over the coming weeks and months. Less participation causes volumes to decline, and in the current environment, will likely increase price volatility. As many traders, speculators, and investors turn off their screens and head off on vacation, bids to buy are likely to disappear during selloffs, and offers to sell will evaporate during recoveries, making rip-you-face-off rallies even more dangerous. Higher volatility will only add to frustrations over the summer of 2022. The buy zone for the VIX is the 20-25 level The VIX was over the 33 level on June 16, but it fell as low as 23.74 in early June. The trend of higher base levels for the volatility index increases the odds of success for purchasing the VIX futures or VIX-related products on dips to the 20-25 area. The VIX is a trading, not an investment product. Approach the VIX with a solid risk-reward plan and stick to the program. Look for better than even odds opportunities, take small losses at risk levels, and look to increase profit horizons when the volatility index rises. When adjusting profit targets, remember to raise the risk points to levels that protect profits and capital. The trend in the VIX is higher, and the potential for a substantial upside price spike is rising. Trading the volatility index from the long side could be the optimal approach over the coming weeks and months as the market faces significant issues and liquidity is declining. Fasten your seatbelts as the whack-a-mole stock market could experience head-spinning moves over the coming weeks and months. -- Trading advice given in this communication, if any, is based on information taken from trades and statistical services and other sources that we believe are reliable. The author does not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects the author’s good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice the author provides will result in profitable trades. There is risk of loss in all futures and options trading. Any investment involves substantial risks, including, but not limited to, pricing volatility , inadequate liquidity, and the potential complete loss of principal. This article does not in any way constitute an offer or solicitation of an offer to buy or sell any investment, security, or commodity discussed herein, or any security in any jurisdiction in which such an offer would be unlawful under the securities laws of such jurisdiction.
CBOE:VIXLong
by Andy_Hecht
1
NQ Power Range Report with FIB Ext - 6/28/2022 SessionCME_MINI:NQU2022 - PR High: 12087.00 - PR Low: 12053.50 - NZ Spread: 75.0 Evening Stats (As of 12:00 AM) - Weekend Gap: = N/A - Session Open ATR: 396.33 - Volume: 27k - Open Int: 241k - Trend Grade: Bear - From ATH: -29.0% (Rounded) Key Levels (Rounded - Think of these as ranges) - Long: 12390 - Mid: 11820 - Short: 10680 Keep in mind this is not speculation or a prediction. Only a report of the Power Range with Fib extensions for target hunting. Do your DD! You determine your risk tolerance. You are fully capable of making your own decisions.
CME_MINI:NQU2022Short
by mv3trader5
SPX Note 22/06/22The index behaves uncertainly. Tuesday's rise turned out to be a sham. Delta flows were negative or neutral all trading day. The DIX showed a decline on the upside. For a sustained rally we need to buy calls, which we are not seeing for the next few weeks. Volatility sellers are not very active either. VXX again took the lead in dark liquidity by yesterday's session. These factors cast doubt on the SPX growth, at least for now. We would like to see a retest or an update of the low of the index, if the opportunity arises. P.S. Due to the positive correlation with the cryptocurrency, we might expect the same actions from the BTC.
CME_MINI:ES1!
by UnknownUnicorn32592850
S&P testing last line of defence before CollapseFRED:SP500 S&P is going to test the most important level for this year. If this level gets broken we can look for another retest of previous lows which are not close. This level not holding means a significant decline for both crypto and stock markets as they are already surging downwards and there is already PANIC on the horizon. The fundamental events that will take place this week and possible increasing interest rates will be the key factor here. Check out our previous post where we made more than 200+ pips shorting the S&P and much more profits buying the VXX the week before that. Don't forget to FOLLOW so you get informed about the next big move and ways to play it out from our channel.
FOREXCOM:SPX500
by Elite_Forex
SPX Note 10/06/22The index is out of its weekly range, "reacting" to the ECB monetary policy decision and the CPI. It doesn't matter though, the news doesn't tell us much. The index was looking for a driver and it found one. From yesterday's note ... "But it's worth noting that there have been purchases of VXX in the dark pools over the past few days and increased interest in 30-strike VIX calls. Traders are hedging their positions against a possible decline"... Buying in dark liquidity gave a hint of a possible decline, which is what we ended up seeing. Another thing worth noting is that traders are protected from tail risk by buying puts on the SPX and calls on the VIX. Therefore, a market collapse will not follow. But the increased volatility will persist. Influence of the negative gamma. The 4000 strike remains the most important, which will be a magnet for the price. Buying the index in the dark is still high. Gamma exposures are already in a zone where we should expect at least a small counter-move. It is worth observing the dynamics of the indicators. Index made the maximum expected weekly move. It is currently trading in the range of 3960-3970. Further declines only increase the SPX growth scenario. On hold...
SP:SPX
by UnknownUnicorn32592850
SPX Note 9/06/22The index continues to trade in a narrow range. From a previous review ... "Options traders do not look for high index prices and sell calls and buy puts when the price approaches 4,200."... ... "The 4,100 level is a trigger for rising volatility, and in Friday's session, volatility sellers successfully defended this level...". Nothing has changed since then. We have big gamma strikes of 4200 and 4000. A likely scenario would be a price approach to one of the strings before expiration. The VIX, meanwhile, has declined with the SPX sideways movement. ... "Options traders have large put positions below current values, so I do not expect the VIX to rise."... But it's worth noting that there have been purchases of VXX in the dark pools over the past few days and increased interest in 30-strike VIX calls. Traders are hedging their positions against a possible decline. The index may start to move out of the range in the coming days, and the driver could well be the CPI.
SP:SPX
by UnknownUnicorn32592850
New VIX Cycle Continues - 6/5/22VIX at the daily view. It looks like the red resistance has been working, for now. I've been shorting VX futures whenever the VIX crossed the red line. However, this red line has a time limit. It becomes less relevant as we get closer to September. It might be sooner... but that's too hard to tell. As stated before, it will be hard for the VIX to achieve 50 - much to the dismay of the social media crowd. They treat the VIX like a purely inverse index (it's not). The VIX will get muted spikes due to one big reason: cash is a position too. The VIX really spikes when there is increased price range in ES and increased hedges in the options market. When cash is trash, options as a hedge is much more viable. However, during quantitative tightening (QT), cash is king. When cash is king, options as a hedge is not as attractive. Also as stated before, it will be hard for the VIX to stay below 20 due to longer-term, legally required hedging. Hedge funds are legally required to hedge their positions. During QT, the hedges stay there quite a bit longer. During a bull market, the hedges cover and reposition. What's next? The VIX is generally range bound for the near future, but it's also winding up. Would there be a big spike? Likely, just not now. I'm not 100% certain when. However, if I were to pick a general time, it would be around September, maybe slightly earlier. That is when there is a lot of rebalancing of the portfolios, fiscal year end for many funds, midterm elections (with some election hedging), and tightening would be in full swing. Near term? Well, June FOMC and Quadruple Witching OPEX are coming up. Usually, about 1.5 weeks lead up to them, there is a local VIX spike. That said, according to the VIX term structure, those hedges were there for several months. I've noticed them back in January 2022 when there is an unusual amount of hedges for July OPEX (which implies hedging for June). That said, I'd rather wait for VIX spikes to short from. As stated before, during quantitative tightening, timing the VIX spikes becomes harder to predict. Going long in VX for a spike to 50 is the same type of greed as going long for a speculative small cap stock for the potential of similar gains. It's reckless and foolish.
TVC:VIX
by Itsallsotiresome
What can I expect from SPX before it is exp?Greetings All! On the eve of the VIX and SPX futures expiration we can expect a rather calm market. The main open interest and the maximum negative gamma is located at strike 4000, which acts as support for the market. The maximum positive gamma is located at the 4200 strike, which is the main resistance. Options traders do not look for high index prices and sell calls and buy puts when the price approaches 4200. The 4,100 level is a trigger for rising volatility, and in Friday's session, volatility sellers successfully defended this level. Options traders have large put positions below current values, so I do not expect the VIX to rise. Sentiment in the dark liquidity market is more than optimistic. The DIX index hit an all-time high on the SPX decline and has generally been in the buying zone for a long time. Looking forward, this is a positive signal for the stock market, and we can see how institutional investors are set up and where to expect the index going forward. There are two trading weeks left before the SPX expires, and the market probably won't show us anything interesting during that time. In the meantime, I interpret traders' behavior as "pressure on the index with the potential for further growth in the medium term."
SP:SPX
by UnknownUnicorn32592850
VVIX looks safe, but VVIX / VIX: "Prepare now"Pane 1: VVIX appears to have broken support implying lower VIX volatility Lower VIX volatility typically means lower VIX. But not always. Consider VIX spiking to 35 and price going crazy. Usually the "volatility event" passes, price and VIX and VVIX all calm down. Imagine the same spike to 35, but this time, price goes nuts every day for a week, up 2%, down 2%, up 2%, down 2%, up 2%, and VIX stays at 35 all week long. Where does VVIX go as the crazy week plays out? - VVIX measures expected volatility of VIX. - VIX is at 35 every day. In contrast to the first spike, this is smooth sailing for VIX (regardless of 'price gone bonkers') Therefor VVIX would be dropping. Pane 2 and 3: SPY and VIX. Are VIX's (red) swings getting larger or smaller? Yet VIX is above 90% of its historic readings . Conclusions: Dropping VVIX always means a "smoother" VIX VIX can get smoother at 9 VIX getting smoother at 25 is rare (but so is Monkey Pox) Recommendations: Always consider VIX and VVIX together: On the same chart (Pane 1 and 2) Pane 4: as a product or as a center point (VIX*VVIX)^0.5 Pane 5: as a ratio VVIX/VIX A "VIX adjusted VVIX" *Thanks to @Vaas for input and inspiration ! Trade safe, stay free.
AMEX:SPYShort
by gb50k