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VXX

VIX - Market Direction2 full weeks until Expiration / Roll / Settlement The Price patterns have been clear for months. VIX is within a Larger Daily Sell. 12.30 remains the Lower Daily Price Objective. Fridays are difficult for the VIX as BR/VF become sellers against protect being placed to Hedge Equity Positions. Distribution has been ongoing for weeks. There is a great deal to SELL remaining. That said, the Indices "feel" weak. The appetite for Risk seems to be waning... Anything can happen here. watch the VIX closely as the lows let go and it's going to provide a Bid for the ES / RTY / YM. Nq seems to be doing it's own thing - Use the VXN for INV.
CBOE:VX1!
by HK_L61
1
VXMT - Mid Term VX - M3/M5/M7, Backwardation Prior @ 22.40The pattern, which for going on 7 Months has been the same. We see Price Action in the VIX Complex within a tight timeframe surround ST Constant 30 Day Maturities (M1/M2) - during Roll Week (prior 2nd Wednesday of Front Month M1) into Settlement, the 3rd week. Every Month this skews the VXX on the ST Curve as it front Loads 100% of exposure to Roll Yield. 77% of the time during this transition to Balance, the VX Curve is in Contango. We witnessed the Prior settlement trade in Backwardation by the largest spread we have seen during the Fed Induced Rally. M2 was Price @ 22.40 during this settlement. The FED's minions quickly squared this to avoid a mini-panic for protection which had built up during the prior 7 trading days. Immense effort was applied to calm the VX Curves M1-M3 CTs. Roll Yield skewed to a level unseen since FEB of 2020, the MId Term Vol sold along with the balance of the short dated CTs - M1 & M2. The VX Curves suppression is coming to an end. This was the first sign in 17 months - uncertainty surrounding the Federal Reserve was gaining traction. It continues to become a far larger issue at present, as by the FED's admission they have overcooked things... the nagging Inflation rate remains well above their target of 2%. CPI & PPI as well as exogenous "Things We need" are in an obvious Price Uptrend - Gas, Food, Energy... etal. Consumers are conserving, seeing higher prices while hearing they will be heading lower... has created a retrenchment in both spending and trust in both Government's Fiscal as well as the Federal Reserve's Monetary Policy. Confidence in both is quietly deteriorating while Wall Street exclaims the Echo works. It does not. Kicking the Can down the road a few months, is not widely held as a solution by the Public, they are well aware there is a storm dead ahead. They "sense" the stimulus support of wages, rents and many other benefits are coming to a decided end. Housing will be in crisis while the Supreme Court vacations... Debt has ballooned to absurd levels since March of 2020 while the First Abusers benefitted enormously, the American Citizenry wants more of the same. It isn't coming any time soon. The dismay and unrest this has begun is appearing across our Nation. .... best to prepare for some rough times ahead. - HK
CBOE:VIX6MLong
by HK_L61
1
VXX - ES Weakening with even greater Technical DivergencesVXX coming back to lower end of Range. We are preparing for a large Selloff in the next 48 hours. VXX Entries are Laddered down to 24.50 from 27.05. M1/M2/M3 VX Curve as well M3-M4 provide pressure for now... Only for Low Participation - We anticipate a High Tomorrow at the latest for ES. It can hold off as late as Globex... we'll be 40% into our SELL with the follow on SELLs into September TF 8th - 21st. December will be our Futures SELL, SEP the Hedge.
AMEX:VXXLong
by HK_L61
4
Fed Sparks Global Market Meltdown, Vixplosion Next?Good morning, folks! Well, well, well, the Fed decides to taper this year, and all of a sudden all hell breaks loose in global markets. If you're thinking this entire "recovery" was just one big magic trick of coordinated monetary debasement, you're absolutely right, and the market's reaction to the Fed minutes yesterday (and today) is a perfect demonstration of the farce. It was an ugly overnight session across global markets, and as of 8:40AM, the Dow is down -0.91% to 34,645, the S&P is down -0.77% to 4,366, the Nasdaq is down -0.60% to 14,769, and the Russell is getting monkey hammered, we're down -1.65% to 2,128 (after losing long term ascending trendline support yesterday). Vix is up a whopping 52% this week and sitting at a 23 handle. We're in the process of testing the descending trendline from the March 2020 high around 85. If this resistance crumbles, imo Vix is going to a 40 handle, and possibly a 50 handle by EOM. Don't forget, we have Jackson Hole at the end of August as well, and if the sentiment at the event is negative after the Fed's hawkish minutes, Vix could have a multi-week breakout, sending it back toward last year's high's. We all know valuations are at nose bleed levels, and speculation is at ATH's. The Fed was the only thing standing in the way of a return of price discovery/fundamentals, and now they've folded their hand to inflation. You know what comes next. The dollar is scorching higher this morning - we actually tested the lower band of the wedge around 93.50 moments ago, before cooling back to 93.37. If we see a notable shift in the US Equity Put/Call, we're likely going to see a dollar breakout to our previous target around 95. This would imply a major correction across the asset classes. Simultaneously, USTs are being bid here which is sending rates tumbling also. The last time we saw a divergence this large against the S&P was in February 2020, just before the market crashed. In other words, the bond market clearly knows something stocks don't, and bond investors have been positioning for a crash since the US10Y yield peaked in March 2021. In Crypto, Bitcoin (BTCUSD) slipped back to a 43k handle before recovering some of the losses. We're sitting at 44,486 and looking brittle. Having said that we have the 21EMA just below us at 43,359, as well as the 21EMA (w) around 40,867. These supports are likely to hold in the interim, but if we do get a multi-week repricing of risk, it's highly probable we see a revisit of the July low around a 29k handle by next week. Ether (ETHUSD) also appears to be losing steam here and rolling over aggressively on the weekly timeframe. A retest of the 21EMA (w) around 2,418 would be my base case in a prolonged risk off scenario. Finally, on the data front, we saw initial claims come in this morning at 348k vs the 370k expected, while continuing claims slipped to 2.82MM vs the prior print of 2.899MM. This is actually not good for markets because the hotter the economy gets, the more the Fed will step off the gas. For a change, good news is bad news. The Philadelphia Fed index also came in moments go which shows an ugly divergence between the analysts expectations and reality. We're looking at 19.4 vs the 24 expected. Clearly regional manufacturing/business growth is slowing rapidly, hinting at stagflation dead ahead. Trade accordingly... Thanks for your time today guys and enjoy the rest of your day, it should be a very exciting day of trade! Cheers, Michael. * I am/we are currently long UVXY, HUV
TVC:VIXLong
by Hedge_Of_The_World
10
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 :)
SP:SPXLong
by TheDots
VIX - Trade Plan for VOL CRUSH ReversalBuy J U N K, chase green bars, chase false overthrows... Patience, Analysis, Temperament, Constitution of Trade Plan - Probability favors all. BTD chasers. We'll happily take the opposing trade and here it is: Volatility Crush Reversal VIX Curve - ON Gap Fills of VIX Cash/Spot & VX Curve we will have completed inverse ladders on the following Positions: VXX 5K - Objective 20K Position, Projected lows into Wednesday ~ 25.08 Trade Structured INV LDR @ 25.68, 25. 36, 25.12, 25.06. VX Curve: M2 - 0 Position / Objective 5K VX Curve M3 - O Position / Objective 5K VX Curve M4 - 0 Position / Objective 2.5K ______________________________________________________________ SMH/TECH Extension to Target & Top Tick 7-9 Large Cap Prop SOXS: 40K Position / Objective 60K NQ: 0 Position / Sell INV LDR to 15363 overthrow TSLA - 50 @ 720 Nov Puts / Objective 100 to 780 Hedge only on Gamma FM Only, Theta not an issue Shares 400 / Objective 1500 INV LDR to 780 AMC/GME - Digging in to kill the roll AMC - Position Objective 12.5K to 37.88 GME - Degenerates are eyeballing 300 GF, no fill until 2022 Collar at 195 Strike out through November. __________________________________________________ Financials ZB - 0 Position, TLT Gap Fill ahead Wednesday Fed minutes for entry ZN - 0 Position, TLT Gap Fill ahead Wednesday Fed minutes for entry TLT - 0 Position, Gap Fill ahead Wednesday Fed minutes for entry NQ BANK - Observing Bank as RTY ES will catch the head fake for entry. Financials will drive ES RTY YM Entries Hedges will be Large Micro CTs in Bracket, OCO form for high turn entry/exit - Hedge ONLY. Powell - Still Thinking about... *Clarida - Taper could begin later this year Quarles - See's Taper discussion coming into view *Brainard - Echoes Taper discussion for September *Waller - Reduction of Bond Purchases in October *Bowman - Policy Statement Support ahead, Hawkish THE BOG HAS TURNED HAWKISH. Events: ALL BOG Members voted for/supported: Individual capital requirements for all large banks, effective on October 1, 2021 $1 Trillion CBCD central bank digital currency Policy Objective Enforcement actions have been tailored to NY/NJ Banks, epicenter of US Finance
CBOE:VX1!Short
by HK_L61
3
VXX - Adds beginning @ 1K per Handle to 25M1/V1 & M2/V2 Roll is in trade. Settlement occurs the same day (Wednesday) as the FED Minutes. We're cool with being early, it's better than late when this blows up and it is setup to do so. The Speculators want a massive blow off. 5K ES everyone. Yeah, naw. Not yet, we need to see a panic sell in order for the FED to double down... and they will. Then, we will see these insane targets for ES YM NQ RTY. The VIX is going to explode higher when it reverses, 30% in a single day as the reversal takes hold.
AMEX:VXXLong
by HK_L61
4
VIX - Price Objective Traded for Micros / LONG ApproachingPrice remains in a well controlled descent, although Price has completed a Target for retracement. Retracements have been minor measure moves, 6 failures at each RT. CASH / SPOT VIX has a Daily GAP at 14.80, lower Range is 14.20. The parabolic move off the lows could see 150-200% gains in very short order. We patiently wait for fills at targets with No Positions. A reversal is setting up for an extreme move on the Daily/Weekly TF.
CBOE:VX1!Long
by HK_L61
1
VIX - VIX.Explosion Setting up perfectlyAs the usual suspects attempt Gamma Squeeze after Gamm Squeeze. Bubbles the Chimp decides to take some off. Participants are backing away, $4 Trillion Jimmy Carnie touted on the "Sidelines" isn't coming into the Equity CONplex. It prefers CASH. TLT needs to close those over head Gaps prior to reversing... or does it. VIX coiling in a falling wedge where Wall Street wants those $0.25 Calls out the curve - simple crush VOL and they are doing so with relative ease.
CBOE:VX1!Long
by HK_L61
VIX - Vol Crush Ratios nearing extremesThe sudden sharp drop in implied volatility has triggered a tightly correlated decline in the Options Complex Values. Friday's Gap Up on the Job Report let a large amount of air out. Volumes on the ES, SPY, SPX were abysmal once again. We suggested that TECH was due for a pullback based upon the TLT, 10Yr Yields and a number of additional causations stated. The ROC for 10Yr yields caught many offsides, as they were NET Long TLT and ZB/ZN. We are seeing signs of a repeat of the February 10th ROC breakaway from 1.13 to 1.71. A "Rampage of Rates" on the long end of the Curve demonstrated it wasn't messing around as profligate Fiscal Policies were met with Revolt. Yields began the highest ROCs in their history - A clear warning sign of issues to come. The Federal Reserve crossed the Rubicon with "Tools" - Yield Curve Control (YCC) to force Yields lower beginning in April to test the arrangements. The FED then doubled down in May and June to assure calm. Since January there has been a large accumulation of Bonds across the Curve - a clear warning sign. One which implies the return of Capital at an assured loss as Inflation is running well above 17%. "Panic" set in then and fear has only continued to compound. We remain aggressive buyers of Volatility at levels. Recall the $0.25 Volatility Options bought to open immediately before the February 2020 collapse. Wall street ALWAYS gets it fill, we are waiting for this repeat on scale for a large correction. Not a collapse, but a correction, Currencies Wars are well under way. The DX remains well collared for now: 92/93. Summer trading is most often "Dodgy" as participation remains Low and the AIQC can move Price just about anywhere it chooses - wanting the high fill. We are closely watching implied volatility for new fills. We closed our range trades from 20 to 21.40 with solid gains and are now waiting to see if the CASH or SPOT VIX will trade to 15.00 to 15.50, it is there we will pick the pieces back up into Roll/Settlement.
TVC:VIX
by HK_L61
7
VIX V1/M1 @ 22.50 + 1 Tick 22.55 Confirms Index SELLThere is a large accumulation of VX Complex Instruments. A warning sign of higher VX to follow. And with the 10/20/50 in Positive Divergence, all signs point to an initial 10% Correction followed by an additional 9% correction. We anticipate the ES can trade below 3910 and overshoot to the downside 3600-3800 range can trade on overshoot. The Bigger Lick approaches, the Velocity will catch many by surprise. Participation requires strength.
CBOE:VX1!Long
by HK_L61