VXX - 4hBlue box target hit, but I did not trade this long, at least not yet. For one thing, I hate trading 4th waves. The alternatives are not much likely, like the bearish alternatives on indices.
DJP trade ideas
VIX - Attention Options TradersIf you trade options like me, then you will take a very close look at the VIX.
So here we are, at the Lower Medianline Paralle of the black downsloping Fork.
What does this mean?
It means, that the VIX has pulled back to equlibrium - to a energy zone of equal, where all is possible again.
Most of the time we can see price turns at the L-MLH in the opposite direction, since the energy (price) is
now at a stage of the opposite extreme, and/or at the center of the upcomming other extreme...
...can follow? ;-)
No problem if you can't. All what it means is, that we Option Sellers are probably looking for strategies, where
we more then not use strategies to buy, instead of selling options. For example some RiskReversals etc.
Let's see how this unfolds in the upcomming days and weeks.
P!
ROLLING: VXX MAY 6TH 21 SHORT CALL TO MAY 20TH 21 SHORT CALLI'm rolling the May 6th 21 short call of this setup to the May 20th 21 short call for an additional $23 credit, as the May 6th had lost a good deal of its value ... .
The long-dated option leg of the setup cost a $752 debit when I put it on, and I've collected a net of $229 in credits so far -- about 30% the value of the long option.
Naturally, as price moves toward the long option, its value decreases, so the entire setup as of right now is "in the red" ... .
OPENING: VXX SEPT 16 13/MAY 17.5 CALL DIAGONALCycling into some more long volatility product here with this VXX diagonal, which I filled for a $3.73 debit ... .
See the post below as to how to work this setup.
VXX - 30mRed path remains my primary expectation. This is no time to enter new shorts here. Great time to take profits on existing VXX shorts, (or XIV longs). Better to wait for 3-wave up into the resistance region of minute wave iv on new positions.
Long VXX is dangerous imo given VIX contango. Aggressive longs need to actively manage stops imo.
This volatility index is approaching major demand levelsAs overall markets come strong into supply levels above.
VXX - Long the Vol!VXX hold 200 dma and 0.786 retracement and SPY reversed. This trade can work quite well
VXX - 15mAdditional detail of smaller degree Elliott Wave counts for analysis shown on linked hourly idea.
VXX - 1hrI've adjusted the degree of recent waves iii and iv. Near-term targets don't change, but longer-term path includes one more bounce and drop later into the Spring. Actual targets for waves (iv) and (v) will be dependent on resolution of wave (iii). I'll be looking for brief bounces to enter short, and will hold for lower targets as long as the pattern holds. Breaking above 19.26 would be a warning to shorts, and 20.24 would be an indication this count is clearly not playing out as shown.
BUYING TO CLOSE VXX MAY 20TH 20 SHORT CALLI didn't like how far out in time I rolled my short call, so I closed it out, opting to sell something closer in time. So I closed out the VXX May 20th short call and sold the May 6th 21 short call instead for a credit of .92 ($92).
I'll attempt to be a touch more patient with the roll this time and wait until a few days prior to expiration or until there is little or no extrinsic value left in it.
I originally received a 1.59 credit for the April 15th 21 short call and .77 for the roll to the May 20th 20 short, for a total of 2.36 in credits ($236). I closed out the May 20th 20 short call today for a 1.49 debit, so I realized a profit of 2.36 - 1.49 = .89 ($89)/contract in profit.
That being said, what I'm looking to do here is to roll the short call over time, collect credit for doing so, and get to a point where the sum of the credits collected + the current value of the long-dated call exceeds what I paid to put on the setup in the first place. Naturally, price's caving here helps out the value of the short call (it decreases, which is what you want), but it also decreases the value of the long call. As with an ordinary covered call where you take a position by buying shares of stock and sell calls against to reduce cost basis in those shares, you generally want price to either remain stable or pop.
I'm naturally looking for volatility to pop between now and the expiration of the September long to bail on the set up as a unit ... .
VXX - 1hrWhile a flat is still possible, VXX faces 10% contango. Targets for the next move are in the low 15s as far as high 12s, regardless whether another brief rally in (iv) takes hold. The channel shown does not necessarily need to be respected, but may be a guide to the path lower.
VXX - 1hrVXX is starting to look impulsive off the recent highs. Wave a of (iv) may well have been all of (iv). A corrective bounce to 19.20/.59 region could be shorted with a stop over 20.25. This would also be a good region to drop longs if you're still holding. I'm not holding long for higher targets at this point...
Will update with targets for wave (v) later, but definitely don't be holding short below 18.40. An expanded flat, while possible, is not a highly probable trade. Certainly not worth risking longs in the face of a potential melt-down in (v) while fighting contango imo.
VXX 2 hours - 50% potential gainI will pull trigger if ever the red lines are taken out, and target is $29.
VXX Since-2015 View (3/242016)Couldn't break back below that green line last week. See the VXX all-time chart to see where these lines come from.
VXX - 1hrI am currently long vol, but only expecting a bounce into wave (iv) price targets. I'll be looking for another short set-up at that time. Closing above 22.39, and especially 23.21 would be a warning to anyone long 'sp500 imo. MACD did not make a new low during red wave (iii); instead MACD has positive divergence with a higher low whereas price has a series of lower lows. This condition could suggest the corrective interpretation of the decline (alt A) which projects into 25 -26 region (alt B). It'll likely be an indirect route with whipshaw. Trading 4th waves is difficult - as is trading corrective a-b-c moves. Preserve capital with stops, protect gains. Exiting with profit on a 3-wave move in vol land has no shame imo.
VXX - 30minSorry, that was meant to be a "LONG" vol position...not SHORT.
Constructive development this morning for those long volatility. I'm anticipating a series of corrective moves into the wave (iv) target region as shown. Remember, placement of the labels is not meant to indicate a prediction on exact timing. These are price regions...
Fib extensions and positive divergences on MACD helped identify the potential here. Use stops, preserve capital and protect gains, depending on your timeframe...
VXX - 30minVXX has turned up from indicated support, but has a lot to prove before higher targets are probable. See earlier 15min idea linked below.
Also note positive divergence on Stoch RSI and MACD.
VXX - 15 minNote resistance for wave (iv) and alternate B. I wouldn't hold out for B unless the 'sp500 starts breaking down through support, too.
VXX - 1hrHere's the other side of the volatility trade. Lesson, don't hold long vol in the face of a 3rd wave down...
I'm expecting a bounce between here and 18.20/.13 region back to 21.39 - 22.39 in wave (iv). Then continued decline to 14 region. Wouldn't be surprised by decay lower than 12.
ROLLING VXX MAY 20TH 21 SHORT CALL TO MAY 20TH 20 SHORT CALLRolled my VXX May 20th 21 short call down to the 20 short (same expiry) for an additional .27 ($27 credit).
This is part of my VXX synthetic/poor man's covered call ... .
Completes bearish Bat patternVXX with completion of bearish Bat pattern.
27-28 is a daily resistance zone. A close below 28 can expedite the reversal in VXX
Pattern completion - 29
