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Thursday, March 29, 2012

$VIX - Volatile April Ahead

The VIX has started to heat up, and a large bullish wedge is in place.  It stopped shy of the 50 day moving average yesterday, hit the trendline, and likely will take a few days to consolidate before gapping over it.  I suspect, next week, there will likely be a "one day wonder" down for the VIX before it spikes again over the trendline. 

Several target zones have been outlined for the month of April.  Notice how the VIX spiked up at the alignment indicated by the arrow.  

Daily Chart















First and foremost, the low is in place with capitulation a few days ago.  A higher high from yesterday is anticipated during the next few days, then cool off again. 

Several targets are outlined for the month of April as indicated by the green lines.  

Daily Chart

95 comments:

  1. Some were actually laughing at my initial $28 target a few days ago. They weren't ready to hear (at that time) that my final target for April is around $41. I will let the market do the talking.

    People don't move markets. Markets move people...

    ReplyDelete
    Replies
    1. hi SC,
      do you think spx will go little higher high then crash down or choppy a while then go down. Thanks

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    2. Hi SC,
      What is your plan and target for HVU in April?
      Thanks!

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    3. Following on Chester's query, what is a good entry point in HVU, is it this week or next?
      thx

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    4. I have charts coming for SPX. SPX should find some footing today then drop again.

      Early next week SPX may rally back somewhat.

      In April it should be a gradual slide down to start with, then plunge.

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    5. So for the other $10.90 is around that final target for April.

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    6. There should be a higher high coming for UVXY etc next day or 2. Next week it'll fall again imo and that will present a nice spot when I plan to accumulate.

      So we'll take it one step at a time.

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    7. SC "so for the other $10.90 is around that final target for April" What do you mean?

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    8. dtg - the "other" is another volatility etf HVU.

      Delete
  2. Hi SC,

    "People don't move markets. Markets move people..."
    I think it is the word of the day.

    By the way do you have any new comment for Gold & Silver?
    Thank you.
    RB

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    Replies
    1. They should dip a little lower short term, then flatten out and rally somewhat next week.

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    2. USD forming the right shoulder of a large IH&S that could take off to 81-83 around your gold silver low dates of April 12 IMO.
      Gold and silver forming small, medium and large IH&S that match up very well with your thesis of a wild ride (not closing my eyes for a second).
      Gold and silver have possibly more immediate smaller potential (1680-1730) and silver (33-34.5) if the shoulders hold and USD is weak tomorrow.
      I like the bigger picture on gold much more than silver though.

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    3. Once they bottom out, both Gold and Silver will be set for large gains. Agree completely that Gold is the one that will surprise big on the upside.

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  3. Hi SC

    your final target in April for HVU is 10.9. Is that the highest of the high HVU will go during the entire month?

    As well, are you planning on selling your UVXY in the next day or 2? You have any target on this high target that UVXY will reach?


    Thanks!

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    Replies
    1. Yes that is about the highest we could see for April imo.

      Yes, planning to sell, and then reload next week. I'm looking at those numbers now.

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    2. SC, That means I better to wait HVU to dip down next week for a safer entry? Thanks!

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    3. I do think this move is in the finishing stage with lower levels next week.

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    4. SC, I agree. Bought XIV at $11.30. Figure it will be over $12 by the close.

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  4. SC,

    You think UVXY will make new low next week? or above last low at $ 12?

    What do you see for silver?

    Thanks

    ReplyDelete
    Replies
    1. No, not a new low but a higher low.

      I think both Gold and Silver should bottom around the 10th, then surge up from there.

      Delete
  5. Hi SC

    what signal you look for when you considering that we will make new higher low next week for UVXY?

    From what you mention here:
    SCMar 29, 2012 09:09 AM
    I do think this move is in the finishing stage with lower levels next week.

    Does it mean after next week, you seeing UVXY going lower for the rest of the month? confused.


    Thanks!

    ReplyDelete
  6. Let's take it one step at a time otherwise it does become confusing. For now it's on the upswing, then it'll cool off.

    ReplyDelete
    Replies
    1. SC,

      I think that will be right approach, I think you should talk only about immediate near future action instead of telling what next after next move and so forth.

      Cheers

      Delete
  7. SC i thought you mentioned that SPY turn negative tomorrow and really negative into the end of the week?

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    Replies
    1. This week was mixed. Tomorrow looked weaker, but we'll see since already have come down.

      The much more negative cyles are in April.

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  8. So if you think it is cooling off, what is happening to your $28 target? At this point it has to heat up to reach $28.

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    Replies
    1. The target is the same but have to wait for that in April.

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    2. So on the recent trade are you expecting just to break even with minimal profit? Depending on how much you averaged down, since you started at ~$20.50. You've been calling $28 since it was $26ish, said $24 would be good entry, then $20, $15... It just keeps dropping

      Assuming you're right long term for April, what went wrong the past two weeks? I just mean, I'd have more confidence if you could explain why things didn't turn out as expected and why the future will be different. As far as I see, target dates just get delayed and prices gradually lower. Your long term goal may be realized, but I believe less and less as short term targets miss.

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    3. I should make decent profit, but yes it was too early. The beauty is that I'll plan to take profit and then reload at a low price. Nice setup for April.

      I had part of the puzzle in place, but not all the pieces. Basically things have been slower to develop. The VIX did start to move on the 27th though so that was on the right track.

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    4. So what is your short term target to take profit? It doesn't look like it will go much higher.

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    5. Above $18 but not a huge amount. I want to see it develop further to fine tune the number.

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    6. To give a rough idea, $21 is the max I am considering. Not set in stone.

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    7. Below you just said you expect positive cycles early next week, so I'm guessing HVU/UVXY decline. That only leaves tomorrow, so you think between $18-21 Friday? Seeing as its $15.62 right now, it seems hard to believe a 20-40% rise. Maybe 20% rise, but it seems like it could drop just as easily.

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    8. If tomorrow quiet it could be Monday.

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  9. so SC your cycles are positive early next weeK?

    thanks

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    Replies
    1. There should be another drop coming. If tomorrow is quiet then Monday morning. After that - positive.

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    2. SC,

      You saying positive for market? or UVXY?

      Thanks

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    3. Does this drop mean a rise in UVXY/HVU? How confident are you? You were 99% sure we would hit $7.50 last Monday...

      Not trying to rag on you, but maybe you were 99% sure that your work was right, and that's okay. What I mean is, assuming your analysis is right, what is the probability the market will behave the way you predict? I.e. you could have been 99% that the inverse head and shoulers pattern was confirmed, but that pattern may only be reliable 66% of the time. Just saying, that 99% call was a bit mis-leading. Not that I believed it anyway, coz 99% for something to happen is ridiculous

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    4. There should be another drop coming for the markets. If tomorrow is quiet then Monday morning market weakness. After that - positive for markets early next week.

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    5. Richard,

      I'm confident.

      I still like that price target, but in early April, and the VIX did spike on the 27th so I had some of the answers. I hear what you are saying. In the future I'm going to be handling these situations differently so as to avoid confusion.

      Thank you.

      Delete
    6. Thanks SC.

      Right now I'm out of HVU. Seeing as your target is right before you expect a positive cycle, I think it would be safer to re-enter on the next low rather than try to catch the slight high that you expect Friday or Monday, in case your target isn't reached and it goes right into the positive cycle. Would you agree?

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    7. If tomorrow is quiet and slumps to $14.50 or so then, max becomes $19.50 or so. So what we need now is to see tomorrow to crystalize things.

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    8. Hi SC

      when you say max becomes 19.50$, is that max for monday next week? or somewhere down further on the road?


      Thanks!

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    9. Hi SC

      Wondering what the price would be for HVU? if UVXY it 19.5.


      Thanks!
      David

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    10. Approx. $5.20. Let's see tomorrow and can fine tune.

      Delete
  10. SC, do you think that gold and silver will dip today or on Monday ?

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    Replies
    1. Either tomorrow or Monday is possible - leaning towards Monday.

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  11. Replies
    1. Fluke. I held on rather than selling, so we'll see if that proves right. If tomorrow is a positive day for the markets, I may sell before the end of the day and stay in cash for the weekend, or perhaps switch to HVU if I could time it right.

      Delete
  12. Hi SC,

    Is there any possibility to drop 28$ for Silver at your projection/TA?
    I don't know the exact time but I think it is probable, just feeling.

    Thanks,
    RB

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  13. The lowest I have considered for Silver short term is $29.50 for the future or $28.50 for SLV.

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  14. Back in December I said the VIX would be a teenager by the time we hit my March cycle.
    The March cycle is due this week. Tick, tock...tick, tock.......

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  15. ZigZag

    Could you post your longer term cycle chart you are following......got lost in the shuffle! Also is that the chart you are referring to here wit hte March cycle? You had posted a number of different ones, got a lil confusing! Tx,g

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  16. Hi Gj....March is the last high cycle I have on my weekly chart. Right now I don't have anything that aligns with that May high projection, so I'm waiting to see what happens mid April before adding to longs. So far, my March 23rd date was only off by one trading day.

    INDU weekly:
    http://tinyurl.com/c2o8rq7

    2012 path that was posted back in December:
    http://tinyurl.com/dymwoug

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  17. Zig

    Tx...........could you postthe whole chart........I think the original went out past November! Tx again........gj

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  18. Zig

    You might want to look at the May high as a low and look for one with a Jume low! gj

    ReplyDelete
    Replies
    1. That's very possible because I can't find anything that aligns with a May peak.. Here's the one that goes to November and it does show a possible June low. All I was 100% sure of was the January low to March high, so now I'll wait and see what develops.

      http://tinyurl.com/c4slxfq

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    2. ZZ, thanks for the charts. Your April 10th date matches up with my Gold cycle low as well.

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    3. May.
      a high? well, after today...why not?

      http://i43.tinypic.com/15rl948.png

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  19. SC, I hope you don't mind my 2 cents here...A word of caution to all those newbies out there- Do yourself a favor and check 'Google\trends' and check searches on 'Robert Prechter' over the last few years and compare the results to stock market moves. You will see a roughly (leading) correlation with the market. It appears that high levels of interest in his current message have become a reliable bullish indicator. Now check the last 12 months and you will see he is recently back on the radar again. Draw your own conclusions and short with an open mind. Robert Prechter's trading calls are now totally and miserably untrustworthy. Whatever he calls his wave theory- it is sadly lacking in the most fundamental ways. Don't be stubborn- he looks valid but he will only deliver when he gets lucky on a call and trading using 'luck' is foolish at best. I do agree with SC in a short-term correction but beyond that, watch for the probability of more upside.

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  20. SC, just plot a simple alligator on weekly or daily SPX. this can continue for much longer.

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  21. AM, what do you mean by this?

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  22. Last day Qtr dressing underway but no matter how much they dress it, underneath it's still a PIG!

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  23. Check out this chart;

    http://stockcharts.com/h-sc/ui?s=$NDX&p=D&b=5&g=0&id=p49809226806

    And this chart:

    http://stockcharts.com/h-sc/ui?s=QQQ&p=D&b=5&g=0&id=p43118062684

    And 13 weeks in a row of rises for the Q's

    http://stockcharts.com/h-sc/ui?s=QQQ&p=D&b=5&g=0&id=p43118062684

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  24. SC, what are you thinking in regards to HVU and todays action? Monday take off still on the cards?

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    Replies
    1. Today was quiet as suspected. Volatility should increase on Monday, and mkts dip, though the question is still how much.

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    2. I'm tempted to get back into HVU at this point. See if you're right about Monday.

      But with all due respect, you said we HVU could reach $5.20 today or Monday, but if HVU slumps today, it could reach $5.20 Monday. So today wasn't really "quiet as suspected," basically said it could go either way so I'm not so convinced about $5.20 Monday.

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    3. Let's just keep it simple. It should at least see a pop Monday. If things are still relatively quiet then it could just be moderate.

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    4. So basically pop in volatility Monday, but since quiet week slump from there.

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  25. I expect some action and mkts dip on Monday, but overall it could be a quiet holiday week.

    I have April cycle charts coming on the weekend. It should be a choppy month with good trading opportunities.

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  26. Hmmm, so you no longer see an HVU spike on Monday or if you do, you don't think it will be significant?

    IOW, $7.50 is out of the question? What about $5?

    ReplyDelete
    Replies
    1. Let's just keep it simple. It should at least see a pop Monday. If things are still relatively quiet then it could just be moderate.

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  27. Notice that NDX is weak today with Apple taking a breather. NDX almost tested yesterday's lows this morning. So that is a decent signal to expect some weakness in SPX Monday.

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  28. Do you also think that gold and silver will be weak on Monday ?

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  29. Yes, some weakness for Gold/Silver on Monday likely. However the recent low probably will hold for next week. I do expect a lower low around the 10th for both metals.

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    Replies
    1. That should be the real low imo - finally!

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  30. I would love to see it pop. Bought HVU at $3.84 today after selling XIV at $12.42. Will buyback XIV next week

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    Replies
    1. Yes, that is a plan. April should be fun to pick and choose spots. Let's call it the Dr. Jekyl and Mr. Hyde market lol.

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  31. SC,
    Theoretical situation: Within next 4 weeks we still do not crash (75-100 points+ to the downside). What happens? Will you reconsider your point of view or admit you were wrong? Or nothing happens at all...?

    ReplyDelete
  32. Absolutely. There is only one thing important to me regarding markets - making profits. I'm not against a bullish stance at all when it makes sense. For example, Thanksgiving week just about everyone was bearish, but I was very bullish. S&P jumped 100 points in 4 days.

    My cycle work does show weak spots in April, and I see it being a rough month. However, if it sets up another bull run to follow I'm all for taking advantage of that situation for the sake of profits.

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  33. BEANS

    http://img842.imageshack.us/img842/4329/beans.jpg

    ReplyDelete
  34. Hi Joed,

    Do you have Gold & silver chart?

    Thank you.
    RB

    ReplyDelete
  35. RB

    I cover many markets ........you can go to my site if you wish! I am not trying to promo my site, just trying to give back as I enjoy SC and the harassment he gets! lol joed

    http://traderjoed.blogspot.com/

    ReplyDelete
    Replies
    1. Lol, thanks for the charts my friend!

      Delete
  36. Sc

    No.........thank you! Your personality is special! I am not sure ppl understand what it takes to put your almonds on the line! Most should try it........lol Best, joed

    ReplyDelete
    Replies
    1. The comments are interesting sometimes... Cheers, have a nice weekend!

      Delete
    2. Sc

      Yep...........I use them to trade off of! lol U 2.....joed

      Delete
  37. Hi Joed.

    I Will visit your blog.
    Thank you.
    RB

    ReplyDelete