SPY is showing remarkably similar pattern to the rally from the flash crash low. Topping potential from swift bearish wedge pattern is confirmed by VIX at one month-plus lows and stretched more than 15% below 10-sma
... without full conviction, but but the VIX suggests another LL . The last week in February would be strange.
The situation on $XIV:
www.investopedia.com
This is my buy/sell range based off fib retrace and fib time. I took a short position Friday as the S&P was still in Green around 10:00. Swing trading $VIX $EDZ based off of price action and charts.
Of course this is a short term play. This coming week has heavy economic data coming from many countries. This bounce took place without much economic data reported,...
Volatility in the broader indices has been on the ebb all week. What does this mean for premium selling? Well, it means that the premium in index ETF's like SPY, IWM, QQQ, and DIA is less rich and therefore not as attractive for selling premium. Ordinarily, when this occurs, I turn my attention somewhat away from broad market index ETF plays or plays in...
Look at what happened during the pre-shock "market dump test" in August.
Look at what happened to the real move at the beginning of this year in Jan., Feb.
The market bounces like a ball, even on the way down
I think at the moment we will bounce for a few weeks.
See notes on chart.
Works for those who don't have time to watch volatility intraday. Doesn't require tracking contango / backwardation.
*edit: prices based on close price of SVXY on the day of the Kagi transition.
See chart.
Bears really need to move things down on the indexes or contango will return to rolling volatility plays.
See notes on chart.
* note: looks like TradingView, in its wisdom, is now resizing indicators from how publishers intended them to be zoomed. Will follow up with another graphic later.
Markets moves on fear and greed, also called supply and demand.
VIX measures market volatility and some even call it The Fear Index.
When market is greedy, demand for risky assets such as equities exceeds supply (Risk-On)
When market is in fear, demand for safe-haven assets such as gold exceeds supply (Risk-Off)
Using 2008 as a guide, if that works, stock market may have 4 to 6 weeks of good time with 5 - 10 % gain ahead. And after that another sell off may make a new lower low.
the yellow line is the RSI,14 of the VWAP of VXX
The other two lines are related to: VWAP of VIX futures price minus the VIX spot price . So the volume weighted premium of the near term futures (I think).
Green is the long (50 day) moving average of the RSI of the above value.
Pink is this: short_ma = sma(((v_rsi - 50) * 1.5) + 50, 30) -- and to be honest I...
SVXY pays a price when VIX is high (>16).... even when SPY is increasing (see arrows). This is due to rollover but not to be confused with VXX decay due to contango.
Historic trend lines for SPY, VIX and the ratio SPY/VIX suggest SPY 50 (assuming VIX 100) in the future.
Timing is estimated with fibs anchored on past crashes.
A simple hedge is to buy Puts on SPY at the lowest strike (70) with a distant expiration date (Dec, 2018 is the farthest right now but these could be rolled, say, once a year)
