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Sunday, October 26, 2014

$VIX - Low Due in 1 Week

VIX made an exaggerated spike up in October once it broke above the red resistance.  VIX is now back under the red resistance.  Therefore, some short term downside for VIX is likely.

An important low for VIX is anticipated due in 1 week.

S&P Cycles were mixed in October.  There were short term cycles in October that were quite negative, but some were surprisingly positive.  The result was a very choppy month.  In contrast for November, the Cycles turn extremely negative and remain consistently negative for S&P throughout the month.

The large scale VIX Cycle is heading much higher into December.

Daily Chart 

83 comments:

  1. For this week I'm expecting chop until Thursday, then a strong rally for SPX to start Thursday for 3 days.

    That'll lead to the high for SPX in 1 week and low for VIX.

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  2. Thanks SC!

    At what levels will you reenter uvxy? Will the low hold or can we see high teens with VIX 12

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    Replies
    1. Let's see how it shapes up later in the week and can look at price levels.

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  3. SC - How low do you see UVXY this week?

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    Replies
    1. Just see chop until Thurs, so I'll be looking at prices later in the week.

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  4. When VIX reaches into that range I'm entering UVXY. Target is $85 in December. Much higher next year.

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  5. I think the problem with UVXY here is that it wasn't able to push above $35 on Friday. For the short term that should result in lower prices for UVXY imo.

    Basically the VIX only found a little support on the 50 dma. Not enough to support it yet.

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  6. I smell some gap ups coming toward 2000. We won't close below 1925 again this year.

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    Replies
    1. "I smell some gaps up" Is this Technical Analysis or Fundamental Analysis? What is this based on?

      I'm truly interested in the "reason" you feel this way?

      Delete
  7. Be Careful October 27, 2014 at 9:23 AM

    I smell some gap ups coming toward 2000. We won't close below 1925 again this year.

    http://tinyurl.com/m63qdwk

    wanted to make sure we memorialize this post before it is deleted...

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    Replies
    1. It would appear that "Be Careful" was the one that was correct Rotrot.

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    2. "Lucrative shorting opportunity at 1985..."


      http://tinyurl.com/kolwbrj

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  8. Market rallying a little, but still struggling. Cycles are weak and choppy until Thurs. SPX will be able to rally more strongly after Thursday.

    Then peak next week.

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  9. No. We're going up up regardless if we fill 1925, 1904 on any dips.

    You know what talking head has been right often with early projections? Tom Lee, ex-JP Morgan. 2012 he called a 1430 year end. 2013 he called 1775 (end 1850). And 2014 now he expects 2100.

    1925 for inverse head and shoulders.
    1900 possible gap fill, for last "correction". No close below 1925. Replay of last Fall basically...everyone waiting, waiting, waiting for down...and all you get is consolidation..and then rocket up. Europe is fine, ECB will increase. Worry about interest rates rather, give people a place to safely earn yield and they will go there instead.

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  10. Damnit. Too strong. 1961 is now the floor on down waves. Up we go for the rest of 2014.

    Maybe 1985 to 1961 to above 2000. VIX now hitting my 14.97.
    Next 14.05.

    Be CarefulOctober 23, 2014 at 5:34 AM
    14.97 VIX, UVXY 26-27 likely.

    Be CarefulOctober 23, 2014 at 6:32 AM
    S&P 2070 maybe late January

    Be CarefulOctober 21, 2014 at 10:33 AM
    Too strong. 1963-65 next. VIX crushed.

    Be CarefulOctober 2, 2014 at 5:33 AM
    More likely scenario. 2019 to 1880 to 19xx to 1860 to 1950+ end of year. Not really that interesting....pretty normal action.

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    Replies
    1. congrats on your calls. I hope you have profited

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  11. VIX
    http://traderjoed.blogspot.com/

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  12. According to plan.

    SCOctober 28, 2014 at 6:09 AM

    "Market rallying a little, but still struggling. Cycles are weak and choppy until Thurs. SPX will be able to rally more strongly after Thursday.

    Then peak next week."

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    Replies
    1. VIX made a small bounce up off the 200 dma. Lower levels coming...

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  13. Pretty accurate on that call SC, well done! By the way, are you still excluding a higher high for the S&P? Best

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  14. A higher high can't be excluded as VIX still has room to decline in the short term. This is an important time period for the market though. I have an update coming that is very interesting.

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  15. Check out Silver and Gold today! So much for the bounce. Heading down to my $13's target.

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  16. Yes gold and silver were crazy today! Congrats on your accurate call. When do you expect silver at $13? Do you believe we are near a temporary bottom right now?

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    Replies
    1. Expect to see that level by December. Possibly even sooner in November the way things are looking. Not expecting any significant bounces. The metals are heading continuing lower.

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  17. Bounce off 50dma S&P overnight...about 1967. We're good to go now. Up and away. Nov December.....zigzag up in 2000s....and higher than you can imagine. Simple. Up. Not down. Up. Up. Up. VIX crushed and will stabilize on low end. VIX trade is over.

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  18. 2010 gap will be filled in a day or two.

    I expect this blog to say extremely Bullish things about the remainder of the year..and to have changed its bearish call. I look forward to its Bullish post per the comments below:

    "A higher high can't be excluded as VIX still has room to decline in the short term. This is an important time period for the market though. I have an update coming that is very interesting."

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    Replies
    1. Prepare to be surprised!

      I like your comments and I've always welcomed bulls and bears. I do agree the makret is heading higher short term. Same as outlook as shown on the chart above.

      The difference is that I'm only very short term bullish, and the evidence is clear. We're heading into a major top.

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  19. Gold/Silver have much more to decline, with the dollar rallying for weeks yet to come.

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    Replies
    1. Gold closer to $1,000 soon. It'll accelerate down.

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  20. Planning to load up on UVXY either tomorrow or Monday.

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  21. S&P at 2023 overnight. 57 point rally two days in futures. Massive rally, bull market, new highs...and going higher. Gosh, I hope your next post is Bullish, finally. Why short into a huge rally that's destined for more new highs? Japan news and ECB...

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    Replies
    1. this is just an feel good move before elections, make the proles happy..seen it before....Japan has been buying stocks for years, look it up....we will see very soon if this is a blow off top

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  22. SCOctober 28, 2014 at 6:09 AM

    "Market rallying a little, but still struggling. Cycles are weak and choppy until Thurs. SPX will be able to rally more strongly after Thursday.

    Then peak next week."

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    Replies
    1. SC, you on a banking roll. congrats on the calls


      Cheers!

      Delete
  23. VIX weekly trend remains up...bullish divergences on intraday chart indicators...may seem unlikely today, however a CIT is coming...

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  24. SC, is uvxy still heading towards $85 by december or is a retest of $50's only? The chart for UVXY with green arrow is confusing - shows going ip, up, up but uvxy making double bottom instead.

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    Replies
    1. I have a chart coming for UVXY next that is more detailed. As soon as it formed the double top last week in the $34's it was destined for a lower low.

      The next chart will show why that happened, and what is next.

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  25. Silver hardly bounced at all in Oct. Gold did bounce to $1,250 in Oct. Then once it breached $1200, the waterfall is underway...

    SCSeptember 9, 2014 at 8:13 AM

    "The Silver Cycle does not show any significant bounces. I suspect Gold is likely to consolidate in this $1200 to $1250 range for a little while (weeks) next. Then plunge under $1200 suddenly. When that happens it should be steady down with few bounces. Basically once this $1200 shelf is breached, then there's nothing to support it, and the next leg down occurs."

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  26. We'll poke the top trendline 2030-2050 sooner rather than later. This whole episode has just stayed within the 2011 top and bottom trendlines basically...we almost hit the bottom near 1820..and now to the top.But overkill is closer to 2100..also the target of many talking heads.

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  27. VIX likely a little lower Monday, and plan to pick up UVXY on Monday. Expecting a pop for VIX into Wed.

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  28. https://m.youtube.com/watch?v=N9lK0UsQ3O4

    The Market Guys - November 1, 2014

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  29. SC, i was looking at your long term Vix chart and is it possible that first yellow arrow was in September & second yellow arrow is coming up next with higher low in 13-14?

    I never quite liked how the two yellow arrows did not make higher lows before, how uvxy/xiv have had no follow through to the up/downside, nor how the vix has plunged back to the lower trendline (if oct was the first white arrow) however the chart would make sense if the vix is forming the second yellow arrow now.

    Thoughts?

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    1. Yes, that is the correct interpretation.

      The fact is that the Cycle shows a massive and sustained move higher for VIX approaching.

      That spike in Oct was just the little pop in the Cycle prior to the second yellow arrow low. VIX is forming the second yellow arrow low in November.

      The VIX move isn't over - it has yet to begin!!!

      It was tricky but I didn't trust that Oct spike. Nothing seemed right about it to me at the time. For one thing my short term cycles for SPX were mixed positive and negative in Oct. That's why I said my strategy would be to trade the chop, and bought XIV instead of UVXY.

      There were a number of clues including the large gap for VIX in the 12's and the fact that daily VIX rsi never went into oversold over the summer. That will happen soon imo...

      Still need VIX lower so it's important to let this set up properly.

      Delete
  30. Thanks SC!

    I do hope Vix puts in a higher low as per original yellow arrow chart - then explosive move up toward 50's+.


    Are you still in xiv?

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    Replies
    1. It's going to be incredible.

      I'm just trading until everything has lined up. Looking for UVXY entry soon.

      Delete
  31. SC, are you expecting the VIX pop into Wed to be short term, with a more significant low to follow after that? Enjoying your posts, and looking forward to the next update.

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    1. I need to see the VIX a little lower to take a position, but soon I will. Yes I expect a strong pop in the VIX from a little lower.

      Yes, then the most significant low after that.

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  32. SC,

    Regarding your Vix target: are you simply waiting for the gap to fill at 12 or is there another reason you have chosen that level?

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    Replies
    1. Both. The gap is an important level, but my short term Cycle still shows some downside for VIX.

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    2. SC, do you mind sharing the timing for the short term cycle low? Thanks.

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    3. VIX popped a little yesterday but in a couple days from a little lower, VIX likely to make a stronger pop.

      Delete
  33. "Now I am going to show you a couple of charts which depict the mother of all divergences in an indicator which has been very reliable in warning of imminent reversals. The top chart is the DJIA and the bottom one the inverse VIX (XIV). I don't think that too much explanation is required. The charts show several examples of short-term and longer-term divergences identifying every top in the past four months. I would think that these charts would slightly lessen the bulls' confidence that this rally is going to continue."
    http://static.safehaven.com/authors/gratian/35649_c_large.png

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    Replies
    1. immediate resistance levels for VIX & UVXY
      VIX: 15.10 area
      UVXY: 26.80 area

      my system identifies immediate resistance levels that are dynamic not static...thus the caveat 'area'...Fibonacci is not a factor...indicators on intraday and daily charts are signaling that a confirmed CIT is not far off...

      Delete
  34. Hello SC, which level do you see for the low in VIX? Between 13 and 14? Or between 10 and 12? Thank you :)

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    Replies
    1. 10 to 12. VIX just experiencing some chop as it works it's way lower and declines below the daily 50 and 200 moving averages.

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  35. Gold and Silver are closing in on my downside targets. Within striking distance now..

    Since the metals are trading inversely to S&P that also implies that the market is nearing a major top.

    The Silver Cycle has been extremely accurate for years since I called the metals bear market in 2011.

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    1. Are you expecting more downside to the metals or a temporary bottom?

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    2. More downside. Can see pauses for the metals, but basically straight down.

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  36. Vix entry is good here, not much downside left...minimal move down could happen...no spike downs....solid support has been tested with little ability to push it below....

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    1. Ideally like to see VIX just a little lower next few days, but generally agree. VIX likely to pop stronger next week. I'm looking for a entry soon.

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    2. kudos for holding out, my campaign is now active...

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  37. For those that are expecting the gap to fill on the VIX this would not be the first time that I have seen a gap act as support ie. repel price.
    This looks like a good entry level right here and I have no intention of getting too cute. This move is going to be explosive.

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  38. It's getting interesting. Soon, I'll be taking a position.

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  39. In. Time will tell.
    Good Trading to all.

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  40. I've never seen Vix with a breakaway gap ...looks like 12 will fill sooner or later.

    The neg divergence on SPX & Vix is foreboding though.

    Not sure if I will see XIV 40 on this move to exit.

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    Replies
    1. I wouldn't consider that a true gap, as it looks like it was in that price range the week before....

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  41. What downside targets do you have for the metals in the near term? Do you see the start of a bull market from these bottom? Thanks!

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    1. Short term targets are $1,000 Gold and $13 Silver. The Silver Cycle shows a bounce for the metals around that level and much lower levels coming.

      The bear market for the metals still has 3 more legs down in the Cycle. Several years left for the bear market to continue.

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  42. Replies
    1. Looking for $27 to $28 next week. VIX reached the target level.

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  43. SC are you expecting another high and another low in uvxy after next week
    around nov 19

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    Replies
    1. UVXY is ready for a $4 or $5 spike next week, then cool off again. Just making a trade.

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  44. Sc, is the second yellow Vix arrow complete or is the just another short relief rally before a drop to 12?

    Ie. EXPLOSIVE VIX MOVE next week or need to be patient a little longer?

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    1. Not the second yellow arrow low yet, but VIX is ready to spike. It'll spike then dip hard into the second yellow arrow low very soon after that.

      This is just a short term trade for me.

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    2. Ok, fine then. Been looking for Xiv around 30 entry. Might fill next week , then ride for top around thanksgiving.

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    3. Might see $31 to $32 then $44.

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  45. SPX rallied too much too fast. It's ready to dip maybe 40 points next week. Then it should run to a higher high and form a major top.

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  46. SC, if XIV hits 44, then uvxy goes to 15

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  47. 15 uvxy seems low unless vix hits 10 or less

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  48. SC an update would be good at this point showing where you believe we are in your VIX cycle.
    I assumed that we were pastthe second yellow arow with the spike above 30 in October being the high between the two yellow arrow lows.
    A bit confused with your position and how you have come to your conclusions??
    Cheers

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