VXX trade ideas
Highest $VIX has been in a long time, Stocks prepping for run?$VIX pumped hard these last 2 days
Was interesting that it hadn't done much considering how much the #markets had fallen.
However, it could be short term topping out as #stocks are oversold atm.
25 has been an issue for some time now.
Other data is showing that we are likely setting up for a nice run.
Don't Fall for VIX Volatility Dead Cat Bounce“Happiness was never important.
The problem is that we don't know what we really want. What makes us happy is not to get what we want.
But to dream about it. Happiness is for opportunists.
So I think that the only life of deep satisfaction is a life of eternal struggle, especially struggle with oneself.
If you want to remain happy, just remain stupid.
Authentic masters are never happy; happiness is a category of slaves.”
VixPurple wave - 50sma
White wave 21ema
Some things I notice happened this week.
1.Daily MACD crossed over bearish
2. Daily CCI curling over
3. Daily RSI breaking uptrend
Those 3 things spell out bearish Technicals for the VIX.
Bounced off 18.00 friday with a hourly RSI at 20 and A oversold CCI on 1hour and 2hour..
I'm looking for a bounce up to 21 and 50 MA early next week and then we will see if the ADP non Farm will break vix out from under resistance or send it back back to 18.
If we break 18 this week the next strong support is at 17... if you go to your monthly chart and draw a trendline from 2017 lows until now you'll see we recently bounced on Feb 2 lows. Can't see thus market going back up 4300-4400 unless vix breaks back below 17
So I'm long until 20.30 , then let's see what happens
Vix Pulled back inside wedge here and is attempting to break 21ema and 50sma support.
Closing gap at 20, if vix closes below 50sma I don't foresee a Catalyst big enough to break it back over resistance until Job report next week. This pullback would allow equities to bounce I the mean time..
Once 20.35 goes things will drop quickly
Vix Since the original breakout the vix has did the usual falling wedge move which is retest and bounce. The movements since the breakout has now formed a Pennant, if we breakout of this Pennant to the upside , the most likely target will be the 200sma. A move to the 200sma would likely send the spy to 385-387.
After that type of move I'd expect a consolidation and pullback in which the market would dead cat
Contrary perspective, inside this pennant is also a double top , but the vix would need to break pennant support and fall below 20.90 for the market to really rally.
Reference note, 22 is tough resistance
VIX: VOLATILITY CYCLES / POINT OF CONTROL / RAISING THE CEILING DESCRIPTION: In the chart above I have provided a SEMI-MACRO analysis of VIX a volatility index on the 4 hour timeframe. This is a brief update on VIX as we have had some interesting momentum taking place.
POINTS:
1. Deviation of 7 points continues to stand and justifies Supply & Demand Pocket Placement.
2. RSI is currently OVEREXTENDED but PRICE ACTION continues to exhibit compressed behavior by only GRAVITATING around 20 POINTS.
3. MACD signals that past cycles have at least seen 2.00 POINTS on MACD'S deviation from Median but has only seen 0.50 since the beginning of this VOLATILITY CYCLE.
IMPORTANT: With a new ceiling confirmed by price actions recent upward momentum it is safe to say that if price action surpasses 23 we will come to see elevated VOLATILITY for SPY, SPX, ES1! or NQ1!. I would consider a BULLISH & BEARISH scenario when it comes to VIX but no recession has ever come to an end without VIX first touching 40 POINTS but here it is.
SCENARIO #1: In a BULLISH scenario for VIX we see an eventual RETEST of 19 followed by further consolidation and a BREAK of 23 POINTS by MARCH 8th.
SCENARIO #2: In a BEARISH scenario for VIX we come to see a break of 19 POINTS to the downside followed by an inevitable RETEST of the 8 YEAR TREND LINE & would elongate capitulation due date.
FULL CHART LINK: www.tradingview.com
TVC:VIX
CBOE:VIX