I'm thinking to make a nice play on my upcoming correction belief.
Only option I have with my broker is VILX, so started looking into it's history.
Only makes big money with big crashes / corrections, and I think we have two on the way.
Data was so small for the main chart, but looking at the RSI here, some very interested volatility wave patterns.
I'm 100% certain a big correction is coming (possibly barring any stimulus that may scupper this, likelihood is it could even be the cause!) start of Q2 2021.
I want to make a Vix play on this and this is my only option with my broker so been taking a dive.
Straight away, arcs of intent everywhere, clear ebb and flow patterns. Being a fib fan, especially in waves...
📌 Working in public has given us a live example of Volatility expanding in times of a crisis.
Here it is usually a swing recap for those following. As you will remember we made good use of the initial tempo in the retreat :
The show must go on... in came buyers with the counter...
... for a 1.19/contract credit.
Notes: Adding a little to my existing position (same strikes) on this pop. Although it now looks unlikely that we will clear the short call strike at 12 by March expiry given current price and average decay rates, we'll see how it goes. 1.09/contract collected on the first tranche; 1.19 collected on this one. In this particular...
During periods of risk the VIX tends to get inverted- typically during times of stress this has stay inverted for quite some time, 6 weeks after last years shock valuation from China.
When this curve goes back to a normal upwards sloping curve, this is usually a very good sign.
The US equity markets has been pricing in the UK as an 'island', the risk of Brexit...
Since I have a "virtual gaggle" of VXX trades on, I'm turning my attention to UVXY setups (in spite of its warts) to go long volatility here.
Probability of Profit: 64%
Max Profit: $120/contract
Max Loss/Buying Power Effect: $180/contract
Notes: The mid price for this setup is $115, but bid/ask is wide in this instrument, so I'd putz with a fill above...