VIX Trajectory through Q4: Once sub $12 is tested, it's on! am not bullish on the market. I am mostly holding selectively bullish until we get a sub $12 dip in the VIX. That's when I go long on UVXY, UVIX, URA, possibly GLD, cash, and short SQQQ and other stocks. If you look at the 1-month to 6-month history of the VIX back to as far as it goes, like the 1999/2002 tech bubble bursting, 2007/2008 RE Crisis turned Great Recession, and the 2019/2020 mini recession I call it with COVID, all of these, and probably further back if the VIX even was calculated, had 12-13 taps many times but only rose vertically after a sub 12 ($9.50-$11.50 test(s)).
Team Biden will continue forgiving student loans, dumping every dollar from his creative rat hole into the markets to loosen the money supply and stimulate markets, even giving loan forgiveness (forgiving a debt of say $200k is the same as injecting the money into the market). If you search Reddit for student loan forgiveness relating to PSLF even after Republicans blocked this action, there's nothing but $100k-$500k+ student loans being 100% forgiven left and right for the last month. What happens with this? Well, it's a tricky way for Biden to try to capture more constituents, destroy our country as he has been in bed with China who owns most of our stuff indirectly, whether it's real estate, our bonds, whatever. Even disregarding my conspiracy theory on this, it's obvious that the Fed didn't lower rates yet as that's their Q3 to Q4 tool they will use last minute to give the markets one more push for Rhetoric/Election sake, it's disgusting.
The VIX will continue testing the falling trend line which is around $19-$19.50 until the end of the year. We most likely (as history doesn't repeat but it sure AF rhymes) dip below $12 for a fleeting time, maybe only a few days, few weeks, or a month, but it won't be long. Once we dip to 11.59 on the VIX I'll begin scaling into ladder options across 1, 2, 3, 4, and monthly expirations long UVIX/UVXY. That's my plan, theories, assumptions, etc. I think we agree, but I'm also tactical. As I mentioned the day before yesterday when the VIX was at $19.50, yesterday, and right now, I called the VIX to drop back to $12-$17 which it did, we now should go to $15, then bounce back to $17 and continue doing 3 steps down 2 steps up until $12, we could bounce again to the trend line which will be closer to $17-$18 probably overlapping my expected $15 bounce rally, eventually the compression will push us towards the end of the year to sub $12 then the blowout happens, but this is JMHO, for now, I'm mostly a hold with selective long picks.
But overall, looking at anything beyond intraday, my intermediate to longer-term bias is surely bearish. Dailies remain bullish on many charts, as of today intradays do too, but this is our last Bitcoin, stock market, etc leg up, we may have ups and downs on the way up but on a monthly to quarterly chart basis, we have one more leg up before the mid to late-year fall that will shake even the dead.
