This is the NQ's VIX (VXN) at the 4 hour view.
The VXN is still trapped in its wedge and finally moving on to the lower supports.
That said, the VXN is also playing the volatility dance. It's making several small volatility jumps to build up for a bigger one. With the VVIX closing above 105, the VXN and VIX are saying that they're not done quite yet.
The bigger volatility jump should be when the wedge resistance (blue line) is decisively broken. From the looks of it, longs have plenty of time before that happens. The question is: which will win? The high liquidity in the market or the VXN's volatility dance? It's a battle of attrition. If the VXN keeps this "dance" up for a while, that would give it enough time for the liquidity cycle to reset.
That should give a decent pullback for the NQ. Why do I like pullbacks? It provides a lot more opportunities for traders to long from.
The VXN is still trapped in its wedge and finally moving on to the lower supports.
That said, the VXN is also playing the volatility dance. It's making several small volatility jumps to build up for a bigger one. With the VVIX closing above 105, the VXN and VIX are saying that they're not done quite yet.
The bigger volatility jump should be when the wedge resistance (blue line) is decisively broken. From the looks of it, longs have plenty of time before that happens. The question is: which will win? The high liquidity in the market or the VXN's volatility dance? It's a battle of attrition. If the VXN keeps this "dance" up for a while, that would give it enough time for the liquidity cycle to reset.
That should give a decent pullback for the NQ. Why do I like pullbacks? It provides a lot more opportunities for traders to long from.