March 30th:
"SPX is thought to be approaching the Cycle peak at point A. The V-dip in late February and the choppy period during March were price behaviour specified by the detailed Cycle. These details are shown on the Deja Vu Cycle below.
Once point A is reached, the Cycle predicts a plunge to the red trendline at point P."
The slide down to the red trendline phase is confirmed to be underway.
2hour Chart
Deja Vu Cycle Peak in close detail. Notice the overshoot at point A!
UVXY tested the pink midfork today, and is set to rise initially into late April. An initial short term target is as shown.
Major targets will be identified by the UVXY Mount Everest Cycle and further defined with charts.
60min Chart
Just curious are you trading or charting... you are sitting on some large losses and have not added to anything or initiated any new positions since January... we have had huge moves in metals and you have done nothing.
ReplyDeleteI've been waiting for confirmation of a top for SPX and bottom for UVXY to take more aggressive short positions.
DeleteSC,
ReplyDeleteAre you saying you do not expect VIX to reach the 11's and instead it will go up all the way until May when UVXY touches the 10's and S&P drops to 1420?
There is strong evidence to confirm that a top is in place for SPX.
DeleteFor UVXY though the blue arrow is not confirmed yet. Sometimes UVXY bottoms after SPX tops. VIX filled it's gap at 11.99 on Friday and spiked. It is still possible that VIX cools again especially because there are bounces in the Deja Vu Cycle as it declines to point P.
Unless uvxy breaks AND STAYS OVER $8 no bottom in for uvxy. Dismal failure yesterday. Now this am back under $7 pre-hour. Any modest vix correction will be $5 uvxy.
ReplyDeleteI will buy any xiv on dips.
There is strong evidence to confirm that a top is in place for SPX.
DeleteFor UVXY though the blue arrow is not confirmed yet. Sometimes UVXY bottoms after SPX tops. VIX filled it's gap at 11.99 on Friday and spiked. It is still possible that VIX cools again especially because there are bounces in the Deja Vu Cycle as it declines to point P.
SC, that $10 uvxy target looks ambitious considering uvxy paltry 22% move with corresponding 43% vix move. Unless backwardation enters scene uvxy will continue to underperform and disappoint.
ReplyDeleteWould need vix in 30 to se uvxy over $10
I think it will perform better once it breaks above the 50 dma around $9. So it is early now.
DeleteWhat vix level would that correspond to?
DeleteLet's see how it play out here this week. I think most likely VIX establishes a range 15 to 18 now.
DeleteUVXY hit that pink midfork resistance yesterday.
DeleteI agree the top is in now (but only the wave 3 top)...mkt should see much more upside into next year IMO.
ReplyDeleteShort term I think we could see a retracement to 1570ish, I think that will be the best place to buy UVXY.
BUT as PAYDAY said, "Unless uvxy breaks AND STAYS OVER $8 no bottom in for uvxy. Dismal failure yesterday".
Phil why only wave 3 top? Market up 4 yrs in a row, 140% up off the lows. You really think it will squeeze out 150%? (1665 spx)
DeletePayday - I have wave 1 from the lows to 1420ish then correcting in a wave 2 to 1290ish.
ReplyDeleteWave 3 completed at 1590, wave 4 should hit 1450ish before wave 5 takes us to 1700++ next year.
I don't take long term trades as mkts are a ponzi scheme run by the so called elite. Deflation won't be allowed IMO but there again I did study Austrian economics so I do fall into the inflationary camp.
My recommendation to other readers is just to trade what you see & be comfortable in your own trading concept. I agree with SC though in that we are due a correction, the difference is I will be covering my shorts much earlier.
Uvxy tracking vix perfectly now!!! Fu&$%^** UVXY,
ReplyDeleteThe decaying beast does it again!
ReplyDeleteThe pink midfork for UVXY is around $7.60 today.
ReplyDeleteI still think VIX establishes a range and trades in the 15 to 18 next for a while (week or more).
ReplyDeleteThis corresponds to SPX most likely going to spend some time testing around the 50 dma which is 1542 today.
SC, when will the big move to fill the gap on uvxy happen? Closer to spx 1480?
ReplyDeleteThe market is slowly weakening, and correction starting, but it does not look like it is ready to seriously break down quite yet either. More likely in the short term to spend a week or more bouncing around the 50 dma.
DeleteVIX also suggests this, and UVXY is not really that firm yet either. All of this suggests we're going to burn some time.
Let's take it one step at a time. I do think that once 1480 to 1500 breaks, that will ignite the VIX and UVXY.
DeleteHowever, in the short run it seems we can spend some time testing around the 50 dma for SPX.
UVXY testing just above the pink midfork. The other spot to keep in mind is it's 50 dma around $8.85.
ReplyDeleteThe blue midfork for UVXY is also around $9.
Deleteso if the SPX stops dropping at max 1530, is your scenario invalidated? I am estimating new highs, or at least revisiting the highs between 1600 - 1610 around mid May before we begin the serious decline of 18 - 20% for the SPX.
ReplyDeleteLet me know your answer, thanks.
I think a serious decline is already underway and in the early stages. In the short term SPX most likely spends some time bouncing around the 1530 to 1550 zone before breaking down more seriously and heading much lower.
DeleteAlthough I think SPX has seen the high a bounce in first half of May seems possible from lower levels. There are some solid bounces for lower highs in the Cycle as it declines to the red trendline.
Delete"We saw a huge spike in call buying on the VIX, the most in a while," said Ryan Detrick, senior analyst at Schaeffer's Investment Research. "That's not what you want to hear (because it usually happens) right before a big pullback."
ReplyDeleteThe last time call options activity hit this level, on Jan. 13, 2010, it preceded a 9 percent stock market drop that happened over just four weeks, triggered in large part by worries over the ongoing European debt crisis."
http://www.cnbc.com/id/100649959
Not yet...
ReplyDeleteRemember Jan/Feb 2010 was when Greek fears first showed up in the market. It dropped hard into Feb 2010, then rose into April and then the May flash crash.
ReplyDeleteSPX should not bounce much at all here because VIX has already broken out above both the 50 and 200 dma's. VIX is going to hold up for a while now, and it does look to be establishing the trading range in the 15 to 18 range up and down, maybe edging a bit higher.
ReplyDeleteIn first half May VIX can settle down again, but now it is going to hold up here imo. VIX does not look like it is ready to head to the moon yet either.
50 dma for UVXY is just above at $8.80. This is going to be interesting to see how it interacts. Does it just melt up right through it?
ReplyDeleteUvxy finally playing catch up with contango. Up 9%...vix up 4.5%.... Too bad its not a 40% up day on the vix!
ReplyDeleteBuying XIV here at 19.84
ReplyDeletebe aware vix $15 gap
ReplyDeleteBig update to my last post in the comments section. Star the discussion and vote up the update if you thought it of value. Thanks.
ReplyDeletehttp://highrevsopenhouse.blogspot.com/2013/04/europe-following-gold-already.html#comment-867223495
VIX did find resistance at 18 and now finding support at 15. SPX did find support, and now approaching resistance.
ReplyDeleteI think we bounce up and down in this range for a while.
SCApril 17, 2013 at 7:16 AM
"I still think VIX establishes a range and trades in the 15 to 18 next for a while (week or more).
This corresponds to SPX most likely going to spend some time testing around the 50 dma which is 1542 today."
The fact big names such as IBM, and GE struggling also suggests that the market too weak currently to bounce much. This also backs up a sideways range for another week anyways.
ReplyDeleteAnother scare for the market looks likely this week. VIX is nearing a low and setting to spike again imo. VIX reaching into strong supports, therefore likely to spike again near term. I'm concerned that the scare may involve North Korea this week. Hopefully it is not too serious!!! Anyway, I'm going off the charts and cycles. Market is setting up to drop again near term.
ReplyDeleteBoth GE and IBM continue to crash today from Friday. This is very negative overall for the market.
Hello SC
ReplyDeleteAre you adding UVXY yet?
Thanks!
VIX is getting ready to spike short term and that is likely this week. However, I think the market fears could settle afterwards and the VIX cool off again for the last time.
DeleteSo athough I am expecting a short term spike for VIX and UVXY, I think the best spot for UVXY comes afterwards.
GE and IBM crashing is an early warning. Now just a matter of the optimal time to short.
SC,
DeleteDo you mean SPX will drop this week, and then rise for the last time, probably next week? until 1570 - 1980? then it will go down to Point P in May? If yes, next week, UVXY may go back to the low 6's or high 5's...
VIX hitting supports in this range so it can spike again this week. Then cool off again afterwards. Let's see how it plays out this week. Seems this suggests the low for UVXY could come in early May.
DeleteVIX had first level of support at 15 but only made a decent bounce yesterday off that level. Let's see it it makes a stronger bounce from 13's back to 17's this week.
ReplyDelete"Another scare for the market looks likely this week. VIX is nearing a low and setting to spike again imo."
ReplyDeleteWow! You still short since January? Your calls have been horrendous!
I'm keeping it simple and positioning for the crash. The time that was safe to be bullish was late last year when my models were correctly bullish. I will be increasing short positions soon, and will post when I do so.
ReplyDeleteMy models predict crash. It has been slow setting up for sure, and that is typical, but the evidence is confirming the models.
Hopes that many had for inflation collapsed last week along with Gold. This remains a deflationary environment. The junk is the only thing rallying any more, big names such as GE and IBM are already crashing.
VIX has been trending up for more than 5 weeks. The market gyrations can last a few more weeks but this market is in big trouble. There is no doubt about it.
ReplyDeleteSC,
DeleteNow VIX has dropped back to 13.6. How low do you expect it to hit, before trending back up?
Prediction: a short term cycle for SPX predicts a rounded top forming over the next day or two, not much higher then plunge.
DeleteVIX has little downside here imo. 13's are strong support for VIX. It's getting ready to spike in a few days. Watch for rounded bottom to form, then spike.
Short term VIX should bottom low 13's and pop to 17 or better. Not higher than 18-19 though.
DeleteSo let's watch for rounded top to form in SPX next couple days and rounded bottom in VIX. The short term Cycle specifically shows a rounded turn.
ReplyDeleteSC
ReplyDeleteIf you seeing us bounce to 17, are you going to add UVXY now since we are around the low 13 already?
Thanks!
UVXY should form that rounded bottom over the next day or two, not much lower, then spike up. However, after spiking I think it will cool off again afterwards. So the optimal spot is looking to be early May for UVXY.
DeleteSC,
ReplyDeleteWhat would be your approx target for the decaying beast in early May? 5.8ish??
I've started to buy today..slowly adding, target is 1600-1620 for S&P.
Thanks.
UVXY may pop all the way back up into the $8's next, but it still looks like it could see a lower low in early May. $5 something. It is a little early, but let's fine tune price levels as things progress.
DeleteWow the market just flashcrashed!
ReplyDeleteRumour on Zero Hedge...
ReplyDeleteGot it, thank you.
DeleteThat could have signalled a change in the wave count...we may now have a top at 1587 instead so UVXY target increased to 6 now.
ReplyDeleteI wish that move never happened because now it makes it more complicated to judge whether to include it and account for any effects or disregard the movement completely.
DeleteWill just have to let things play out some more...
Probably won't be much of an issue anyways.
DeleteNew chart is posted.
ReplyDelete