VIX Still Stopped by Liquidity 7/24/2020
VIX at the 4 hour. The VIX finally fought back against the high liquidity. It took a double bottom pattern to fight back. However, the high liquidity levels have solidified the supports on the ES. Therefore, the VIX could not break the wedge resistance (blue line). In fact, it stopped right at the wedge resistance. The VIX was then smacked down by the 200 DMA.
After 2 red days on the ES, the VIX ran out of time for this volatility run. We may get a little more volatility come Monday morning. However, the high liquidity internally will continue to stop big volatility jumps.
Ill be going long when I see the last dip ES. We got 4 big tech companies reporting next week, a Fed meeting, and month end reporting all in the same week. That's a recipe for a dip then rally.
The VVIX is implying that volatility is no where near over. The wedge ends in about 2 weeks from now. VIX may break it earlier - depending on multiple factors. The dollar strength needs to bounce HARD if we want this pullback to continue. I'm not counting on it right now.
When this pullback ends, I'll likely buy from the bounce.
After 2 red days on the ES, the VIX ran out of time for this volatility run. We may get a little more volatility come Monday morning. However, the high liquidity internally will continue to stop big volatility jumps.
Ill be going long when I see the last dip ES. We got 4 big tech companies reporting next week, a Fed meeting, and month end reporting all in the same week. That's a recipe for a dip then rally.
The VVIX is implying that volatility is no where near over. The wedge ends in about 2 weeks from now. VIX may break it earlier - depending on multiple factors. The dollar strength needs to bounce HARD if we want this pullback to continue. I'm not counting on it right now.
When this pullback ends, I'll likely buy from the bounce.