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Tuesday, February 26, 2013

$SPX - VIX Spike Implications

SPX plunged and met the minimum target area both in terms of price, and on time.  However, the market still may decline lower this week.  Several important lines of geometry rest below.  Best to wait for further evidence of a low forming.

The behaviour in the VIX suggests a short term low relatively soon though.  Probably this week. 

Large Cycle updates will be coming shortly.  

30min Chart
 
VIX spiked above the white trendline.  A spike such as this typically suggests a short term low for SPX is nearby.

However, the longer term picture suggests a major crisis is just beginning.  Not serious yet, but the critical red and white trendlines are approaching.

Daily Chart







75 comments:

  1. Even though the minimum area has been reached, really need to give it some time here.

    The market still may go lower this week before it rebounds in March.

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  2. SCFebruary 20, 2013 at 12:26 PM

    "Powerful move for VIX today off the double bottom. This is the start of a large months long move higher for VIX imo."

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  3. SCFebruary 20, 2013 at 6:13 AM

    "UVXY still looks great, and again, this is in terms of the bigger picture. UVXY did come down a little over $1 during the last month. All that has happened is that VIX made a double bottom with January. The fact VIX is holding so well is indicative of a market that is peaking. VIX agrees with my large Cycle.

    I think people will be very surprised by how high UVXY reaches over the next couple months."

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  4. Small bounce today, but best to wait until Wed/Thurs and see more evidence of a low forming imo.

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  5. SC, how does what you wrote translate to UVXY?

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    Replies
    1. I still think there may be a higher high coming for UVXY later this week.

      After that I do expect it cools off again early March, then a much larger move up.

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    2. I'm working on charts for UVXY.

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  6. Hi SC

    You not planning on exiting today with your UVXY position?


    Thanks!

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    Replies
    1. UVXY still can make a higher high this week. Good idea to start being cautious with it though. Doubt there is too much upside left short term.

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    2. I may give it a little time, but exit this week.

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    3. you plan on going to exit everything or just partially with UVXY?

      Thanks!

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    4. I suspect one day this week UVXY opens with a gap up high, then just slides and cools off for a week. We'll see.

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    5. That would for sure confuse the new bull out there today.

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  7. I sold 10% uvxy at 12.49 and another 10% got stopped out at 11.85.

    I have XIV buy order at 16.50...

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  8. Bougt 25% NUGT here at 6.00...

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  9. EMINI


    http://traderjoed.blogspot.com/

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    Replies
    1. Hi Joed

      Thanks for the updates. Always refreshing.


      Thanks!

      Delete
  10. Low of 1485 respected so far. Low was 1485.01, lets see if it can make the high of 1503.00

    indusequitiesFebruary 26, 2013 at 6:44 AM
    SPX range 1485 - 1503

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  11. Hi SC

    You think we still will see a new low this week? Looks like as indusequities mentioned above, we bounced from there so far.


    Thanks!

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    Replies
    1. It will be helpful to see tomorrow/Thurs to determine.

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    2. For now look for a range of 1480.00 - 1503.00 for this week

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  12. less than 5 point from 1503, 18 point ish from 1480. If we are in this range, then more power to the downsize soon?

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    Replies
    1. Sold my last third of UVXY this morning. Thanks for the great call on UVXY SC. Hope you were able to benefit from the recent pullbacks or not.

      Delete
  13. Wow! Can I buy UVXY back below 9 again! Think we will see new highs in the markets by early next week!

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  14. SPX 1500 is critical to see 1480. If we go above 1508 today, then 1480 might not happen.

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  15. Hi SC

    Are you still planning to exit your UVXY this week or hold it now till April?


    Thanks!

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  16. I think we may retest 1490 SPX. Low is likely in place though.

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  17. i cut my position in half on spike
    will enter when spy hit last support just below 1520
    vix will be at 14.5 ish
    good luck to you too SC, im going to add more money in to even out my losses. patient is a virtue

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  18. Why is this board so quiet today? Hope you ALL are getting ready to load up on the UVXY again. Markets will make new highs next week, but UVXY will not make new lows. Next level 16-17 in April!

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  19. Hi SC

    now that we are above 1500 again, do you see that as a support and 1490 is now out of the question?


    Thanks!

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    Replies
    1. The way this market is swinging 1490 is possible. Would not surprise me.

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  20. Replies
    1. you in UVXY before and didnt take some profit?

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  21. Repurchased UVXY @ 10.20 & 10.33 this morning.

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  22. UVXY from 8.75 to 13+ and you did not sell any ??? Just curious why?

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  23. I did sell, at a cost average of 12.4. Looking to buy back very soon.

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  24. Joe do you see the market topping soon?


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  25. Couldn't resist, bought back a third below 10. Will add another third if lower tomorrow.

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  26. 1520 is just below the white trendline for SPX. Strong resistance. Probably dip to 1500 to 1505 soon.

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    Replies
    1. wow look at all those bullish comments in CNBC, wonder where they were yesterday or the day before. Dang hot

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    2. The headlines are always amusing. Where is the headline that mentions that the S&P is still struggling only 45 points above Sept. The market is only up 45 points from 5 and a half months ago (with QE). Very weak!

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    3. today has made a strong candle....i would wait for tmr

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    4. Or how about that the S&P is still down from year 2000 and 2007.

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  27. True, but how about S&P up more than 100% from 2009?

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  28. good morning
    congrats on your calls SC - bang on - up to 1520. hopefully thats it & we now move down

    have a great day

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  29. Good morning,

    There is strong resistance at 1520 so should see a mild dip next. Things should calm down for the next while. No major moves. I think dip to 1505 and back up to 1520. Something like that.

    I have updates coming to explain further.

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  30. we just broke this strong resistance. Does that invalid your analysis at all with a dip?

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    Replies
    1. SPX just overshot the white trendline by 3 points. I think a dip is likely here. Let's see.

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  31. SC explain to us how UVXY had a 40+% move to upside and you chose not to sell a share ? I thought your plan was to trade around position looks like you missed a great opportunity to cut your loss

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  32. Yes, normally I would be more actively trading. I've been busy lately, but will be more active in the future to capture market movement more efficiently. Obviously my large Cycle is very bearish and predicts much larger moves coming. The market is in a slow period by my model.

    This next update will show this.

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    Replies
    1. The best trading period in the model will be coming over the next 2 months. So as the slow period is coming to an end in March, the action will pick up dramatically, and we're getting into a more exciting time frame. Larger, faster moves coming...

      I am looking forward to it!

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    2. Remember, my model predicted that recent pop in volatility, and that was just the first little blip in the model. Volatility is going to continue to expand dramatically in the months ahead according to the same model.

      Actually, volatility is entering an expanding period for years according to this model. The market has been in a period of decreasing volatility for many years, but that is coming to an end.

      Delete
    3. Hi SC

      When you say volatility here, you talking about market going up and down more frequent. Or you talking about VIX?


      Thanks!

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    4. Mainly, talking about the VIX. We're heading into a period of a faster moving market, with much larger moves ahead. The model is very bearish overall, but there will be bullish spots along the way too. Will always approach it one step at a time.

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    5. For now the turquoise line makes a decent target for SPX. Around 1510.

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    6. Hi SC

      So you going to wait till April then before you do any selling now?


      Thanks!

      Delete
    7. I'm open to making moves if it makes sense. Though I think much better opportunities are coming.

      Delete
  33. a great opportunity is when UVXY went from 9 to 13 in a couple days... its largest 2 day move since August of 2011.

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  34. Actually a great opportunity in 2011 was TVIX 15.65 to 110 in 8 weeks!

    Be nice to see UVXY make such a move!

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  35. Hi SC

    Are you exiting your UVXY position this morning?


    Thanks!

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    Replies
    1. I'm considering that. May be the way to go.

      Delete
  36. I am already out at 12.3 on my third I bought back!

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  37. I think VIX is very well in place to go higher in next week, selling at this level, doesn't make sense.

    Cheers

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  38. SPX may head back to 1520 then drop again next week.

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  39. We may be bouncing up/down in the 1495 to 1520 range for a while.

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  40. SPX made the dip I suggested yesterday.

    SCFebruary 28, 2013 at 6:20 AM

    "Good morning,

    There is strong resistance at 1520 so should see a mild dip next. Things should calm down for the next while. No major moves. I think dip to 1505 and back up to 1520. Something like that."

    ReplyDelete
    Replies
    1. So now let's see if that was support.

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    2. Hi SC

      we hit 1520 ish and dip to 1505, then back up to 1520. It not much of a trend. Are you expecting something change after back up to 1520? like new high?


      Thanks!

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    3. I have an update coming to explain better, but ideally the market may bounce up down in this 1495 to 1520 range a few times, pop over 1520 briefly, then collapse to 1390.



      Delete
  41. on weekly chart, major support is at weekly's 200 ma 1250ish as time goes on

    we will see how everything plays out


    good work SC

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    Replies
    1. Yes, it's going to get interesting. Thank you.

      Delete
  42. http://www.cnbc.com/id/100511332 <---this is the signal to go short boys :)

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