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Friday, October 10, 2014

$VIX - Just the Beginning

VIX did break out above the red line resistance.  According to the VIX Cycle this is just the beginning. 

However, the market will likely calm down next week as some consolidation is due next.  Sideways next for a week or so.  Then, SPX is likely to weaken and continue to grind lower later in October.  

The Cycle suggests a much weaker November and December with VIX accelerating higher.   

Daily Chart










 
VIX Cycle 1:
 

 
UVXY is starting to warm up.  It's testing the blue resistance and previous peak in Aug.  Look for a small dip next week to backtest the breakout.
 
Expect a grinding up trend to develop.  Larger pops are due late in Oct, and it will be choppy.  It should surge much more smoothly in November once all the resistance is cleared.
 
The up trend is developing.  Targets are in the $70 to $80 range for 2014, and $175 to $245 in 2015.

 
Daily Chart
















UVXY is likely developing an up trend similar to below.




 
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44 comments:

  1. honestcreditguyOctober 10, 2014 at 4:17 PM

    So much technical damage to equities it's hard to imagine a big retreat in vix. Maybe back to 18 to test support that was resistance...SC can you include the numbers on the chart to see where Vix is per your cycle...

    ReplyDelete
    Replies
    1. SCOctober 10, 2014 at 5:03 PM

      Yes agree, resistance is now support for VIX.

      Delete
    2. SCOctober 10, 2014 at 5:04 PM

      I'll have some targets and measurements coming to make comparisons.

      Delete
  2. SpudthorpeOctober 10, 2014 at 4:19 PM

    Does that mean you have abandoned your outlook for a substantial rally for much of October, and VIX cooling back off to sub-12?

    Thanks...

    ReplyDelete
    Replies
    1. SCOctober 10, 2014 at 5:02 PM

      Yes, it's time to adjust to a more bearish stance. There are some positive Cycles, but they have just amounted to sharp bounces in a downtrend. The dominant trend is down for the market.

      Delete
    2. SCOctober 10, 2014 at 5:15 PM

      The S&P likely won't be much lower at the end of Oct than now. It'll be choppy.

      Delete
  3. rotrotOctober 10, 2014 at 6:25 PM

    on the UVXY forecast chart what does the blue arrow signify?

    ReplyDelete
    Replies
    1. SCOctober 10, 2014 at 6:35 PM

      The blue arrow just shows where in the trend chart we are currently. There is some short term resistance around this level for UVXY.

      Delete
  4. SCOctober 13, 2014 at 6:22 AM

    Looking to short into a small bounce for the market early this week. Likely a quiet market this week. Next week dip to 1870 to 1880 SPX imo.

    ReplyDelete
  5. SCOctober 13, 2014 at 7:25 AM

    There is potential for the market to bounce this month though. VIX could see a decent dip. The 50 dma is way down at 14.

    ReplyDelete
  6. PayDayOctober 13, 2014 at 1:27 PM

    Think the opportunity to load up on UVXY passed. On way to white arrows now.

    ReplyDelete
    Replies
    1. honestcreditguyOctober 13, 2014 at 1:52 PM

      I think your right...maybe small bounce before elections or after OPEX this week...

      Delete
    2. SCOctober 13, 2014 at 2:12 PM

      UVXY target for Nov $75 to $85.

      Delete
  7. SCOctober 13, 2014 at 2:02 PM

    Yes, VIX is on the way to the white arrow. Small bounces for the market will occur, but the dominant trend for the market is and will be sharply down. November looks worse than this month. Next year looks extremely weak too.

    Still plenty of opportunity to short. The VIX etfs are still cheap. It is early.

    ReplyDelete
  8. SCOctober 13, 2014 at 2:04 PM

    Small market bounce can occur from this level. Market is oversold short term. I'll be shorting the bounce.

    ReplyDelete
  9. SCOctober 13, 2014 at 2:05 PM

    There is going to be major panic in November.

    ReplyDelete
  10. PayDayOctober 13, 2014 at 6:36 PM

    SC, how big of a bounce are you expecting? Vix correct to 18?

    ReplyDelete
    Replies
    1. SCOctober 13, 2014 at 6:48 PM

      A sharp bounce looks possible tomorrow. This has come too far, too fast. Bear market bounces can be very sharp and sudden.

      Sharp but small bounce, and it won't last long at all. Short any bounces, a lot more downside coming.

      Delete
    2. SCOctober 13, 2014 at 6:55 PM

      Also, there is no way the market can keep dropping at this rate. It's going to be very choppy for the rest of the month I think. It's going to form a trading range. Good opportunity to trade in and out, and I plan to take advantage.

      Delete
  11. SCOctober 14, 2014 at 7:38 AM

    UVXY popped up through the Aug high and blue resistance yesterday around $39. That level should be tested and act as support.

    ReplyDelete
    Replies
    1. SCOctober 14, 2014 at 8:21 AM

      I can come a little lower than that level, but support is building, and another run is coming soon.

      Delete
    2. rotrotOctober 14, 2014 at 9:16 AM

      This comment has been removed by the author.

      Delete
    3. SCOctober 14, 2014 at 9:22 AM

      Thanks

      Delete
  12. SCOctober 14, 2014 at 8:17 AM

    Market bounced strongly as expected today so looking to short.

    ReplyDelete
  13. AnonymousOctober 14, 2014 at 10:11 AM

    Is gold a good short here? How much more upside do you think there is?

    ReplyDelete
  14. SCOctober 14, 2014 at 11:14 AM

    Gold bounce finishing imo. Should be heading close to $1,000 by year end.

    ReplyDelete
  15. SCOctober 14, 2014 at 12:36 PM

    Big bounce for UVXY off the $39 support. Looks like low $50's by Thurs, then down to $40.

    ReplyDelete
  16. AnonymousOctober 15, 2014 at 9:51 AM

    Gold has put in major rally here, 70$ off of the bottom already. 1180-->1250. 1200 was penetrated and set up major bear trap...

    --------------------------------------------------------------------------------------------

    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.

    Under $1000 does seem possible for December. All markets have been quiet lately but this is when the most interesting things always happen. Volatile periods are preceded by quiet periods. The VIX Cycle suggests a volatile period is ahead and that does fit well with the Silver Cycle.

    ReplyDelete
  17. SantaOctober 15, 2014 at 10:35 AM

    Hey SC

    did you enter any position? or you exited your XIV and just waiting around?


    Cheers!

    ReplyDelete
  18. SCOctober 15, 2014 at 12:03 PM

    Expecting big bounce for the market into Monday.

    ReplyDelete
    Replies
    1. SCOctober 15, 2014 at 12:04 PM

      SCOctober 14, 2014 at 12:36 PM

      Big bounce for UVXY off the $39 support. Looks like low $50's by Thurs, then down to $40.

      Delete
  19. SCOctober 15, 2014 at 12:16 PM

    Getting ready to pick up a batch of XIV probably tomorrow morning. UVXY back to $40 then up to $56.

    Trades are going to come fast.

    ReplyDelete
  20. beetlejuiceOctober 15, 2014 at 12:58 PM

    Agree SC sold my TVIX this morning long from 2.74 gotta be happy with that!
    Will look to pick up again around $4.20.

    Cheers

    ReplyDelete
    Replies
    1. SCOctober 15, 2014 at 1:14 PM

      Well done!!! This is the most perfect market to trade. I know the market can't crash right now because the VIX Cycle high is not due until late Nov, or Dec.

      So it's a traders market for Oct with Nov looking truly ugly!

      Delete
    2. honestcreditguyOctober 15, 2014 at 1:17 PM

      I sold out of TVIX a bit early but did pick up on XIV at 25.05 and letting it ride until Nov. 2nd...

      I believe you could get tvix back in the 3's if rally is strong, vix at 20 or testing 18 on overshoot seems baked in

      Delete
  21. beetlejuiceOctober 15, 2014 at 1:01 PM

    What's your target for XIV?.......I'm looking for $35

    ReplyDelete
    Replies
    1. SCOctober 15, 2014 at 1:16 PM

      Just remember the XIV doesn't move as much as UVXY, and also that UVXY is the place to be come Nov.

      Until then trade the chop!

      Delete
    2. SCOctober 15, 2014 at 1:17 PM

      Big bounce for the market either Fri or Mon imo.

      Delete
  22. SantaOctober 15, 2014 at 2:18 PM

    Hey SC

    what your target on XIV on this big bounce?


    Cheers!

    ReplyDelete
  23. PayDayOctober 15, 2014 at 8:38 PM

    I'm expecting VIX retest to at least the 10ema (19) if not the 50ema (16) later this month... Uvxy targets 35 & 29 with similar in XIV...basically when they hit 1:1 ratio swap out XIV for UVXY to ride the pulse into yr end.

    ReplyDelete
  24. SCOctober 16, 2014 at 4:47 AM

    New charts posted!

    ReplyDelete

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