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Saturday, October 5, 2019

SPX - In VIX We Trust

SPX has a clear Double Top which completed this September.  

The top is in.  Last week the trendline was broken to the downside.  SPX will soon resume the downtrend which is already in place.  

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VIX has been trending higher for years.  Starting in August the VIX trend began to accelerate to the upside.

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VIX continues to trend higher to break the 1987 trendline which has already been previously tested.

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SVXY has been leading lower for more than 1 year to date.  The recent failure of SVXY to test the July peak was the "tell" that SPX had, in fact, topped.

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155 comments:

  1. I do not believe in miracles.

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  2. VIX, you are free, run like the wind...

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    1. Great call last week Louis! Sorry about that whipsaw, you had the right idea!!

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    2. No worries I made money with it

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    3. Shorting volatility was great to uvxy 90 to 23 sick move td ameritrade let's you short uvxy if you go into hard to borrow program and over 100k value

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  3. Sc r u holding uvxy from 30. If market falls will gold go up

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  4. Sc so when spx 2635. What will be vix. And uvxy?

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  5. 2,635 SPX target for first half next year. I only show 2,780 SPX on this chart as an initial downside target.

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    1. Hi SC, thank you for update. I believe spx will whipsaw for a bit and eventually go for your target of 3050-3080. Cannot pin point yet as I dont have a break out point yet. All the best.

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    2. Forgot to mention, VIX target is 12.5

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    3. Thank you. Sounds good. That would be fine by me. Keep us posted on further developments. All the best as well!

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  6. SPX closed at 2,952. It is dropping to 2,635 target due first half next year.

    VIX will retest 35 at that time which is the December 2018 high.

    UVXY is $26.45 and doubles to $50.

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  7. Thanks. In this run of spx. How much higher. 2960 to2980

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  8. There is one positive I see for SVXY. It held the 50 weekly at $51 as support. Unfortunately though for SVXY it'll have a death cross on the daily in about a week's time.

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  9. Low first half of 2020..? I thot it will be high first half of 2020?

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  10. sc so what your saying is you think we drop to 2780 and thats where
    you will exit?

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  11. 2910 is the next bottom. Bank earnings start Oct 15. White House will unwind tariffs, inevitably. FOMC rate cut, Oct 30.

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  12. Bank earnings will be horrible.The White house will not unwind the tariffs.And everyone already knows the rate cut will be .25 already baked in so a non event.

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  13. I mean this go around not next year?

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  14. UVXY has broken out above the white trendline on the UVXY chart.

    However, UVXY may find some resistance at this level today. I say this because SVXY tested the weekly 50 at $51.23 this morning.

    Remember we were looking for a low today on SPX with bounce into Friday.

    SPX may bounce for a couple days here. I continue to think that SPX is heading lower and that the next low is likely on October 14th or 15th which is when the next round of tariffs take effect.

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  15. yes i sold today at top lookin to buy back

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  16. SPX has dropped and is testing the white trendline this morning. I think today's gap down will likely be filled by Friday.

    Next week, SPX will break the low of last Thursday.

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  17. UVXY has the red resistance overhead at around $29.60. If it cools later this week it can fill it's gap and also backtest the white trendline at about $27.

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    Replies
    1. my orders in to buy at 27.25 big block

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    2. i bought some at 28 on that dip not that much only 10000 shares

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  18. Reality starting to sink in that there is no Goldilocks market. More like the Joker. HAHAHA

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  19. Market waited till the last minute, but dropped like a rock.
    Thanks for the great call SC!

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  20. I was just looking at your 3rd chart. You have the VIX going to $60 next year. Is that correct? $60 on the VIX would be HUGE!

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  21. bought uvxy at 27.76 and tvix at 14.60

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  22. SC .. where do you see bitcoin going in the next year?

    Thanks

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    Replies
    1. There will be a decision made by Monday regarding Bitcoin etf. If it is approved, GBTC will fall by arbitrage approximately 23%.

      I'm watching.

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  23. bought tvix at 14.30 and uvxy at 27.30

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  24. This looks like even my bearish to me now!!!

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  25. bought tvix at 14.09 and uvxy at 26.97

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  26. I got an obscene amount UV XY and TVIX

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  27. Possibly an immediate S&P 3003 in next two sessions. Earnings will be ok, yet again. VIX about 14.86 - 15.15

    "Be Careful October 10, 2019 at 7:09 AM
    S&P 2995, then 3017 soon."

    "Be Careful October 7, 2019 at 7:46 AM
    2910 is the next bottom. Bank earnings start Oct 15. White House will unwind tariffs, inevitably. FOMC rate cut, Oct 30."

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  28. long uvxy 24.90 tvix 12.75 nice average

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  29. you might hit 3000 when they find out the deal is not as big as it should be look out below!

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  30. this market full of crap when its low they say things are wrong when its up things are great we might see 3000 to 3024 after that i am looking for 150 points down spx

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  31. SC where we r now. Temporary truce on trade war

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  32. Usually about the time when everyone is bullish for a nice snack down

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  33. I dont think ViX will go below 14.5 Prob a great buy opp

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    Replies
    1. VIX very solid. Yes, VIX building support around the 200 weekly which is 14.70.

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  34. SVXY will decline as projected. The SVXY chart hasn't improved, and it will experience the death cross in two days. This bounce has done nothing to improve the situation.

    Having said that I'm looking at a model that suggests SVXY can retest the $56 high by October 22nd. The model shows it falling 11 days straight afterwards and continues lower until November 19th.

    UVXY pop for a couple days because of the SVXY death cross. I expect $20 or $21 in another week though October 22nd. It'll spike after that for a month into November 19th.

    I may do a little hedging here. I'm looking at VXX Oct 25 $21.50 puts which I may enter on Monday or Tuesday. My plan is to increase UVXY position aggressively in about a week time as SVXY tests $56, and get ready for the large runup for UVXY into November.

    VIX is strong. It has golden crosses both on daily and weekly charts. We are going to see volatility in this environment.

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  35. How high do you expect uvxy to go before
    21.50 and what price in nov?

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    1. No, the 21.50 is for VXX.

      UVXY pop into $25's Monday/Tuesday. I expect it to come down to $20 or $21 Oct 22nd.

      The model I am using shows the next high for UVXY November 19th. Expect UVXY to hit the 50 weekly in November which is currently $41.95. The 50 weekly is declining though so by November 19th it'll be lower, probably close to $38. Interestingly the same number we have talked about for a while.

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  36. I was thinking oct 22 as a low you are thinking a high?

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  37. Same negative siutation for SPX.

    From October 22nd SPX to drop for 11 days straight and continue lower to November 19th.

    The market will have little patience for this "deal".

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    Replies
    1. SPX to rise for a week then down for a monthh.

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  38. So you are expecting TVIX to go to $10 UV XY to go to 2021 correct

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  39. So you are looking for an approximately $1 bounce in UVXY to $25.XX on Monday/Tuesday? Currently at 24.65

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    1. Yes, death cross is imminent, probably happen on Tuesday for SVXY this week. That should lead to a small pop in UVXY Monday/Tuesday.

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  40. Sc do u think spx will make new high or it will be 3020 again Also the china delegation will discuss hard lines who will agree to nothing probably. So it will come down to 2750 or so

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    1. It's possible to see SPX testing the high, but it is topping. It's not a bear market yet, but SPX is heading lower for 4 to 6 months.

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  41. SC, are you looking for a new SPX ATH in this process. Notice the divergence from SVXY last few SPX tops. https://imgur.com/a/g9VBJe1

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    1. Yes!!! Thank you so much for posting this comparison! We've talked about the comparison; this chart is a great visual.
      This is most important.

      Remember, the character of the market changed in February 2018. SVXY/XIV went parabolic and then collapsed. Said another way complacency went parabolic and collapsed. The drop continues. SVXY started to accelerate lower in August compared to SPX.

      SVXY is the canary in the coal mine. Despite this fact traders are watching the SPX chart. Sure, SPX can make marginal higher highs, but is looking more and more exhausted.

      The gigantic loss in SVXY occured in 2018 and nobody is watching this chart. They cannot see what is happening.

      SVXY is going lower than most can imagine. VIX sky high. This is a volatility event and it's going to end with a bang!

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  42. Bought more uvxy at 22.04 and tvix at 10.92

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  43. Yes the Puts are performing well

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  44. in 1/3 huv.to vix 13.5 broke down from 14.5 will add as vix approaches 12.5

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  45. S&P 3048-3050s will happen. VIX 11-12.

    "Be Careful October 11, 2019 at 7:05 AM
    Possibly an immediate S&P 3003 in next two sessions. Earnings will be ok, yet again. VIX about 14.86 - 15.15"

    "Be Careful October 10, 2019 at 7:09 AM
    S&P 2995, then 3017 soon."

    "Be Careful October 7, 2019 at 7:46 AM
    2910 is the next bottom. Bank earnings start Oct 15. White House will unwind tariffs, inevitably. FOMC rate cut, Oct 30."

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  46. https://www.youtube.com/watch?v=Fh5UbgasE28&t=3s

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  47. INDU down 75 points with UVXY in the red and SVXY in the green.

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    1. Big drop coming in my opinion I dont care where vix is b careful what are you buying or shorting?

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  48. The ascent will move through 3008-3017 very, very soon...hitting top of daily Bollinger 3025. There may be some gapping up.

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  49. options expiration. next week will be different.

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  50. The VXX hedges are gone now.

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  51. SVXY is close to the $56 targeted. It has done it's best to attempt to avert the death cross. The efforts are futile.

    Death cross is imminent.

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    1. Any concern that both the 50 MA and 200 MA are both trending upward?

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    2. Yes, I am watching that also, and I do think it's a concern for later in the year. Santa Claus rally potential.

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  52. VIX testing it's orange trendline. Let's see the reaction. A jump to 17/18 would give good symmetry on the chart.

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    1. Any concern that both the 50 MA and the 200 MA are trending directionally upward?

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  53. SC, are we still on track for a UVXY low on the 22nd?

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    1. Just an estimate. There's no particular significance to the date. Let's see how things shape up this week. A turn looks to be close.

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  54. WeWork bailout lol. That was the IPO they tried to jam down everyone's throat.

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  55. Just look af the call activity in uvxy
    Massive

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    1. I've been watching that also. It's very interesting and unusual because normally UVXY declines naturally with decay.

      Yet, nobody is buying the puts. Yes, everybody is buying UVXY/VXX calls.

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    2. I have a theory about how this condition may resolve. I am looking at a strategy for this as well. I'll explain at a later date.

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  56. At what price are you looking to sell your puts?

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  57. I'll wait until next week, and will add. Turn is close now.

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    1. I have an insane amount of TVIX uvxy

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    2. This market could get slapped down tomorrow

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    3. Sc is Uvxy target 38 tvix target 20 still

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    4. SVXY has reached the $56. We'll see a turn next week. At least see a strong bounce.

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    5. Lol I see your being cautious what is your svxy target to down side

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  58. What are your thoughts about taking a position In UVXY with the repos/QE going on?

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    1. What is interesting here is that SPX isn't really gaining at this point. At best we can talk about a marginal higher high.

      Volatility is settling down with no real gains in SPX.

      UVXY just for short term trading at this time.

      Yes, we must respect that the trend is down for UVXY. When the time comes to hold it for a big move then we will be in a good position.

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    2. When do you see that happening? Still down into November?

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    3. UVXY could still see lower. I am waiting, but it's getting closer.

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  59. S&P 3019 immediately
    UVXY to 20.45 soon, possibly 19.xx
    Next UVXY rally...final top at 28.xx

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    Replies
    1. Lol who cares I'm gonna buy so much at 10 and 19 the market makers gonna shit there pants

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  60. Looked at VIX closely. VIX is testing the orange accelerated trendline which is also the level of the September VIX low.

    It is holding so far. If it is not strong enough to hold the orange trendline, then yes, it could see 12 which is the long term white trendline and the July VIX low. The white trendline has been support for years.

    VIX is strong. Expect to see 20 before the end of the year (even if 12 is tested).

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  61. Ate you adding to your tvix position or just uvxy

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  62. Interestingly, for SVXY the 50 and 200 daily moving averages, and the 50 weekly have converged to the same price. Around $52. So that figure makes for a good target, but the price could see a bit higher before it turns.

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  63. Yup so I guess the miracle came through
    I had th short st 29.90 t 7 of my Market timer friends talked me out of it lol that short will be 8 points I still made money on it though

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    1. There was fear in the air in October, and that fear will give rise to panic.

      Yes, things have calmed, but it won't last.

      Conditions are perfect for volatility. We are in for one wild ride...

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  64. https://www.youtube.com/watch?v=A69spSZhY0U&feature=em-uploademail

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  65. Thanks Louis, that looks like a big Dec and Jan rally

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    1. no problem weird how vix up and uvxy tvix lagging

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  66. As we near the close, DJI down 220+ points and UVXY down and in the Red. Can anyone explain? Seriously.

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  67. Large gap up coming Monday. The gaps begin...up...up...and...up

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  68. https://finance.yahoo.com/news/jpmorgan-warns-u-money-market-093439609.html

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  69. SC, are you looking to buy more UVXY today/tomorrow?
    Approximately what price are you looking for?

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    1. No plans today. VIX getting some lift off the orange trendline, but we'll see. 12 does look possible.

      Market is in a tight range. I'll wait.

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  70. UVXY should hit 18.90 by October's end

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    Replies
    1. I agree that SPX will hit 3018 to 3020
      But I am expecting a huge smackdown of about a 120 S and P points

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  71. Sc expected price uvxy downside still 20 or lower?

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  72. Uvxy big piece of shit the only way to be is short every pop!!!! And then some

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  73. UVXY will also hit 18.48 this year
    SVXY should hit 58.30

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  74. Replies
    1. VIX bounced off the orange trendline at the September low.

      Next VIX probably down to 12 to test the much stronger main trendline at the July low.

      Not turning yet, but it's a good sign. VIX 12 then 20.

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    2. if the vix gets to 12 where will uvxy be and tvix 18 and 8.5

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    3. Lol that's 50 percent that you will be down what's the plan? I'm gonna start shorting this more hedge myself

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    4. That's why hedging was a good idea. It worked well, but the VIX is getting quite low now. Plan to add when VIX reaches 12.

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    5. These aren't large moves, but we are progressing to that point. SPX is constricted which means it is in a very tight range, and it will lead to an explosive break.

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    6. I have a huge position i have to hedge even though i have a great average i am also long svxy too!! i will sell and cover shorts whe vix hits low 13

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  75. Bitcoin plunged on Zuckerberg crypto testimony.

    Expect it can drift a little lower 4 to 5 weeks. The bottom is near.

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  76. https://www.youtube.com/watch?v=Hl7L6CJz3EI&feature=em-uploademail

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  77. SC there is no guarantee that we C 12 on The VIX

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  78. I am out of all my shorts on UV XY Bought more UV XY and TVIX

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  79. More gap ups coming...over 3016, 3022...into mid 3000s. Next major bottom 2975-85.

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  80. A snail in my garden moves faster than SPX!!!

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