Possibly the most important chart right now...Possibly the most important chart right now... especially if you are a bear.
VIX futures still holding.
VX1! trade ideas
VIX appear to reverse to BULLISH - Fear is backFTSEMYX:FBMKLCI
Fast Turtle Buy appear for the first time is weeks.
It seems like VIX is bouncing from Fibo .618
ATOM Bearish trend back into neutral zone.
FiFT still -ve but BoD appears..
VIX up => Stock Down
Meaning :- Fear amongst the investors increases. Expect stock market BULL run to pause or may turn BEARISH.
VIX is retesting support at 40. INTRODUCTION
VIX is the ticker symbol for CBOE Volatility Index, a popular measure of the stock market's expectation of volatility based on S&P 500 index options.
It is often referred to as the fear index or fear gauge.
When VIX index moving up, it's indicating fear amongs the investor has increased. The probability of market sell off is high when VIX rally. i.e VIX up, Stock Down.
ANALYIS
VIX is easing since 20 Mar, which led to small rally in stock after sharp drop due to Covid19 pendamic.
Currently VIX is retesting at support around 40 which confluence to key fibo 0.618 and EMA50.
FiFT indicator is still in bearish mode and volume is getting thin.
MACD is also still bearish but seems like turning.
CONCLUSION
VIX is resting at support. Therefore, most stocks should be currently at Resistance zone.
IF VIX bounce up, then chances of Stock Sell-Off is high.
IF VIX able to break below 40, then stock will continue to rally.
Considering all the observations above, probability of VIX bounce up (Stock sell-off) is higher.
Hence, it's best to stay aside for now.
I will publish analysis of the few popular stocks which align to this findings.
A spread on volatility (VIX)During this time, we are witnessing to a surge in volatility. Spreads on VIX are becoming interesting. I wouldn't consider the first deliveries as we do not yet know when this period of fear on the financial markets will end.
The spread I propose is VXK20-VXM20 (to sell). As we can see from the chart, the spread has turned into an always stronger backwardation (the same did the VIX term structure). The seasonality is (in theory) bearish, but that doesn't mean the spread will drop in the next days/weeks.
We have to wait for the end of this wave of panic, before selling the spread with, as the target, a return in contango.
Vix furtues spreads and stocks above 20day lows.. Vix furtues spreads and stocks above 20day lows.. a good point to mark the end of the market drop by spoting divergence between price index and vix spreads or stocks above 20days lows
SPX - FookinGAMMABro'sREAD:
R azor-Focus-Situational-Awareness
E xtrapolate Out the BullShit
A ssess the Environment We are In
D igress toward Adaptable/Flexible Strategies
Don’t get hooked on hopium…Hope is not a plan. Hope is bullshit…“Get Comfortable being Uncomfortable…Shoot-Move-Communicate! TEAMs via Simpleton-Leadership”
VX Volatility Spread...Interesting!Front End vs Back End Spread...wait for the flip??? HEAD SHOTs ONLY
Volatility Coiling to ExplodeHard to ignore this pattern. VIX futures look poised to explode higher in the coming months.
VIX breaking support The VIX has broken a long-term supporting trend line and this might indicate that the much-anticipated correction is going to be an inversion and bullish continuation. If the S&P500 can breakout above the upper resistance trend lines on the weekly chart, it might just fool everyone again.
This would invalidate my prior short sale plan. And breaking this trend line on the VIX should not be overlooked or taken lightly for use trading with real money.
WaitingThere is no catalyst yet for a reversal on the VIX. However, we aren't far away from a long term supply area at the beginning of the year. While I expect more bullish movement, the supply line is where it could get interesting and reverse. We would need to see less demand volume and rejection of highs at this level to consider a change in direction. That said, there is another point of resistance higher, if a pullback does not appear at the marked supply line.
Convergence devolved into flat channel, dragging continuesTrading VIX since the break-out on Oct 4th hasn't been easier.
WHY
8 week channel
perfect BB enveloping
clear VP matching
Action to take
trade on daily chart
have your SL sit aside channel
Looking For A Spike In VolatilityS&P500 VIX Futures have broken to the upside and breached the downward trend line in place since 2-April-2018. I am looking at the iPath VXX to take advantage of a potential upside move. With Gold also looking to break to the upside, this could provide an additional hedge.
