XIV has overheated and a reversion to the mean is likely in the months ahead.
When prices become this stretched from the normal, the move tends to be quite violent with a panic decline.
2day Chart
This model shows similarity to XIV. Notice the sudden drop with no warning, and continuation lower:
Not much room for downside on this chart for UVXY. Price slowly grinding along support with time. Spike up likely within a few weeks.
2day Chart
Largest point decline for XIV since 2015 likely to begin shortly in my opinion. Within a few weeks...
ReplyDeleteThank you SC! It seems like according to your XIV chart...maybe a little more to go say 2770s SPX and then rollover soon...
DeleteYes, one more pop for XIV would be ideal. Very stretched. It is nearly mature according to the model.
DeleteCongratulations bears! The numbers are confirming the overextended market condition with extreme sentiment readings.
Delete"The difference between market optimism and pessimism on the Investors Intelligence survey is at a level last seen in April 1986, 18 months before Black Monday. Bullishness is at 64.4 percent while bearishness is down to 13.5 percent."
https://www.cnbc.com/2018/01/10/market-optimism-reaches-potential-danger-sign-not-seen-since-1986.html
The market went up 50% from April 1986 to September 1987, before the October crash. If UVXY had been around back then it would be down at least 90 - 95% during that period.
DeleteIn 1986 the dow went flat. Consolidation year, and then declined 10% during the middle of the year. 1987 surged up early in the year and then the October crash.
Deletehttp://www.61point8.com/Portals/0/article%20images/20180111/20180111COMPQ1.png
DeleteR2K got its 10 Jan Bradley Date low right on schedule...Coincidence? Hmmmm.... As for UVXY... well, if you own it, Be Careful!
ReplyDeleteNow, any winter shock drop will not go below S&P 2637 (just below 50 day, bottom bollinger band, gap).
ReplyDeleteRUT 1590-1610 now? Fake breakout? I don't know.
FTSE fake breakout? I don't know.
UVXY now has steel ceiling at 50 day, 12.50 - 12.68 (it gets there only on horrific S&P drop).
Don't f--k around in this batsh-t crazy market, please.
i dont know about you but you dont think we could drop 2800 to 2700 in one day ive seen it before
DeleteNo one does that VooDoo as well as You Do, Dr. Bradley!
ReplyDeleteMASSIVE R2K move off yesterday's low! For the skeptics...keep an eye on 17 Jan...and Be Careful with uvxy until then...
January 17th! Nice. Right before the government shutdown on January 19th!!
Deletemarkets on steroids
ReplyDeleteBitcoin is crashing. It'll drag the market down with it.
ReplyDeleteSPX/XIV must be getting close SC...
DeleteStock market is in beast mode hopefully we will see some volatility probably won't happen till we hit 2800 on the S&P
ReplyDeleteUpcoming Bradley Dates: 17 Jan and 29 Jan...depending on the cycle math used...so could 17 Jan be a potential HIGH and 29 Jan a potential LOW?
ReplyDeleteUpcoming World Events: US Government Shutdown decision, 19 Jan; DAVOS, 23-26 Jan; State of Union, 30 Jan; FOMC meeting, 29-30 Jan.
Coincidence? Hmmmm....
Futures are on steroids again
ReplyDeleteNo idea how your trading this with the analysis posted
ReplyDeleteThe U.S. stock market is unstoppable. When is this nonsense going to end?
ReplyDeleteThe Shiller PE Ratio as of last Friday (Jan 12th) is 33.80. Extremely overbought. Stocks have never been this expensive with the sole exception of the tech bubble in early 2000 when the Shiller PE ratio hit 44.
Based on the upcoming traditionally bullish events, it's also possible that the 29 Jan Bradley Date is...(insert drum roll here)...also a HIGH...after some potential churn in between now and then of course. Always in motion the future is, so...Be Careful!
ReplyDeleteXIV has two distinct drives. In December the first drive was three weeks. The second drive formed in January two weeks.
ReplyDeleteIt is getting weaker and if it makes a final third drive that would be ideal for three drives to a high. Common reversal pattern. Last week of January does look to be likely timing.
Notice the three drives to a high in the model...
DeleteOf course more importantly all three drives are wiped out on the initial decline. Then the massive drop occurs in the model.
ReplyDeleteSC, do you have a target high for this pop in UVXY before the third dive?
ReplyDeleteIt shouldn't see over $10 if the third drive is in play. $10 is line in the sand. Vix is trying to breakout but there have been numerous false breakouts. The real one will come soon...
Delete9.72 Out and break even. Phew, sideline to take a look. Leave a small position for lotto. It is still the bull market even the daily reversal seems powerful, but could be wave 4 and one more leg go after the gov shut down is dodged
ReplyDeleteBitcoin has dropped to $10,000. $5,000 looks possible next.
ReplyDeleteMy short vol system exited to cash early in the trading day, after being short vol since early December.
ReplyDeleteI am in cash until it signals reentry.
The system is in no way predictive, it could signal as early as tomorrow afternoon or it could be days or weeks away.
Do you have a target for the down side of UVXY?
ReplyDelete(Thanks for the great blog!)
A little lower might be possible with uvxy but shorting this would be pure Insanity in my opinion
DeleteSure enough $10 was the line in the sand for UVXY. Failed at the resistance this morning.
DeleteThe third drive is in play. However, the downside may be little. Likely we'll see low $8's by the end of this week anyway.
No one can do that VooDoo better than Dr Bradley do!
ReplyDelete17 Jan HIGH...Coincidence? Hmmmm...
Now the real question to ponder...is 29 Jan another HIGH or a LOW? Hmmmm....always in motion the future is...Be Careful!
Jan 29 is bottom for Vix so it will be the bottom for uvxy according to my understanding.
ReplyDeleteMy short vol system went from cash to short this afternoon,
ReplyDeleteNot predictive, it could go back to cash tomorrow for all I know.
What system is that?
ReplyDeleteIts a trend following system for inverse vol of my own design, nothing special.
DeleteIt's main attribute is that it doesn't give me free will. It gives a signal I do what it says, like a robot.
This works for me, saves me thinking and reacting in emotional ways. I don't have any emotional investment in the trades, no wanting to be right, no averaging into losing positions in an effort to be right.
I have never found an edge that I can build a system around that will trade UVXY profitably. I've tried. Sometimes I thought I had something but it always turned out to be recency bias and the edges I thought I had would not survive an extended back test.
More power to those that can make money with it, I can't.
With today's super bullish close, and the upcoming traditionally bullish events...29 Jan is most definitely maybe looking like another possible Dr Bradley HIGH...potentially...or maybe not...either way, Be Careful with uvxy until then!
ReplyDeleteWill the Government shut down causes the sell down?
ReplyDeleteThe model is looking perfect!!
ReplyDeleteIn the model there are still 3 bars left before the collapse. Each bar is taking 1 week. That puts timing in the first week of February.
Timing for the sudden drop? Thanks SC.
DeleteTop and drop due in the model first week of February.
DeleteI am confused. Is the model one of the charts on this page? They claim to use shorter time periods, not weekly bars?
ReplyDeleteThe model is the white chart on this page. Comparing XIV weekly bars (not shown) with this model the bars are identical and number of bars is matching up also.
ReplyDeleteI see, thank you.
DeleteThe majik pixie dust of Dr. Bradley's Dates just keeps floating R2K and the broader market higher and higher...Coincidence? Hmmmm...
ReplyDeleteWell, if this Bradley VooDoo continues, the current course may get a little choppy, but 29 Jan is certainly looking more and more like a HIGH Tide with each passing wave (pretty DEEP, huh?).
Or maybe not...just something to ponder in the coming days...but for now--Be Careful!
sc are you planning on buying more uvxy your thoughts
ReplyDeleteYes I am already positioned and will continue to increase to overweight. XIV is looking incredibly weak. SPX did make the higher high but XIV has been too weak.
ReplyDeleteVix is flirting with a breakout. So close...
SC do you think the breakdown XIV may happen in January instead?
DeleteXIV is sideways but looks terrible overall with the weekly threatening to roll over into a sell.
Delete$60's will be tested.
60s? Are you modifying the current expectations on the charts above? So far we're only looking for 95-115...Thanks again as always SC...
DeleteIt's best to show the moves one step at a time. The chart above shows an initial shallow decline to start with. After that initial drop a bounce and down into the $60's.
DeleteI see - many thanks SC!
DeleteS&P 2807 will hold.
ReplyDeleteBreakdown in SPX/SVXY correlation here... Inverse vol staying stead https://imgur.com/a/bqW9Q
ReplyDeleteOil will be 68. S&P more up...
ReplyDeletewhats the time frame in your opinopn on 95
ReplyDeleteFebruary is likely to be one of the worst months of the year.
ReplyDeleteIn 2 days XIV has lost 6 weeks of gains...
ReplyDeleteWell's what interesting about that is SPX is still up 175 points from 6 weeks ago...my question is even when XIV drops to 115 and erases months of gains, will the SPX only be down 100 points from here?
DeleteYes, excellent point. XIV appears to be leading down which is normal before a large decline.
DeleteSupports for SPX at 2,725 then 2,580. Later in the year 2,300.
Thanks SC. That seems to line up well with XIV 115 and 95...Let's see how long it takes for the initial decline...Could be starting now if UVXY can hold over 10...
DeleteUVXY breaking out above the line in the sand at $10!
ReplyDeleteyou did say last week of January looks to be likely timing...let's go SC!
DeleteWe might still see chop or sideways but XIV is definitely in trouble.
DeleteI do wonder if XIV will bounce one last time for your third drive...If so has to do it soon...
DeleteSC do you have any targets for SPX if we get that third drive higher in XIV to 150-155?
DeleteIf there is a third drive it'll be only minor. XIV has lost it's momentum. Sideways until it goes off the cliff.
DeleteSeems like third drive in play on XIV...maybe 2865-90 on SPX before the plunge...SC do you have any upside targets on gold before it begins it's long descent?
DeleteGold should make a higher high from 2016 before it collapses. 1400's.
Delete10.25 failure, again. danger.
ReplyDelete8.92 for sure
ReplyDeleteNothings a guarantee but death and taxes
DeleteSome points to ponder...
ReplyDeleteAll models are wrong, some are useful. No one rings a bell at the top. Always in motion the future is...but if 29 Jan does produce a high, then...Be Careful!
2795-2807 will end all nonsense.
ReplyDelete11 - 11.52 ceiling UVX-whiiiiiiiiiii....
Whipsaws 9.25-12.68 follow
Uvxy looks like it wants a break out it wouldn't surprise me to see this thing above $12 in the next 2 weeks
ReplyDeleteclose at 10.45 would be beautifull
ReplyDeletesitting on a huge block of uvxy and a big short on xiv
ReplyDeleteStopped out of my short vol position at a loss.
ReplyDeleteMassive selloff coming. Yes, it may be choppy and shallow to start with, but it will plunge deeper and deeper. Bottomless...
ReplyDeletesc whats your time frame 2 weeks a month your opinion
Deletenot gonna holda ya to it
This is very odd behavior SC...SPX going straight up and XIV/VXX/UVXY are going the other way..and don't buy this rally at all
Delete"The market can remain irrational longer than you can remain solvent."
DeleteWe'll see a drop in February and much deeper in the months to follow.
DeleteSC, are you expecting sell off in first two weeks of FEb, and rally to April
ReplyDeleteDown for months next. There will be some bounces on the way down.
Delete"Bottomless" -- wow, now THAT's DEEP!
ReplyDelete29 Jan High? Coincidence? Hmmmm...
Congratulations again 'Be Careful', you're the only contributor on this blog that has consistently made excellent calls. I wish you would contribute more or ideally start a blog of your own. Many of us would eagerly follow you!
ReplyDeleteSC, do you notice this decoupling of SVXY and SPX? https://imgur.com/a/EIeoK
ReplyDeleteYes, it's a clear warning.
DeleteS&P 3000 happening.
ReplyDeleteNo massive selloff coming.
ReplyDeleteAAPL up soon.
ReplyDeletehttps://www.zerohedge.com/news/2018-01-26/one-bofas-imminent-market-crash-indicators-was-just-triggered
ReplyDeleteWithin 3 months...
I don’t care how high the Spx goes what I care is volatility. Imagine spx increased by 175 points, but UVXY is solid. What will happen if spx reverses course uvxy will fly. Check the volume in uvxy lately that tells you what is coming.
ReplyDeleteYes, exactly!!!
Deletelooks like after the 16th of feb? or before
DeleteNotable pullback on 29 Jan...Coincidence? Hmmmm....
ReplyDeletecome on baby pop this uvxy
ReplyDeleteSC is this the drop or do you think we are still waiting until next week?
ReplyDeleteSC - ^VIX close at 13.85 break out from down trend ?
ReplyDeletefutures sinking overnight...this must be the sudden drop SC!
ReplyDeleteRecognia software has detected a double bottom chart pattern on proshares trust uvxy This bullish signal signal indicates tthat the price may rise from yesterdays close to the range of 11.50 to 11.80 this pattern formed over 19 days which is roughly the period of timein which the target price may be achieved. uvxy has a current support of 10.23 and a resistance level of 12.04 expected price move 15.4 percent according to recognia
ReplyDeleteYes, this is the sudden drop with no warning as shown in the model.
ReplyDeleteSupport for XIV is $110 to $115 for this first leg down.
Bradley Date VooDoo -- alive and well -- Be Careful!
ReplyDeleteNicely done with the dates DC!
DeleteGreat call Louis! $12's today!!
ReplyDeleteLouis LombardiJanuary 25, 2018 at 7:39 AM
"Uvxy looks like it wants a break out it wouldn't surprise me to see this thing above $12 in the next 2 weeks"
The estimate for the first leg up for UVXY is $14 give or take.
ReplyDeleteare you selling in the 14s or your gonna wait until
Deletethe next leg
Ideally should see $14, $10, then $20 for UVXY.
DeleteCould exit at $14. Or just add more at $10 and hold for $20.
i have a massive position im gonna cover short on xiv when it hits bottom sitting on 5000 xiv short and a hugbe position onuvxy i will probally sell half at 14
DeleteThe warnings were clear!
ReplyDeleteSCJanuary 24, 2018 at 10:27 AM
"We might still see chop or sideways but XIV is definitely in trouble."
SCJanuary 24, 2018 at 10:13 AM
"UVXY breaking out above the line in the sand at $10!"
SCJanuary 25, 2018 at 10:51 AM
"If there is a third drive it'll be only minor. XIV has lost it's momentum. Sideways until it goes off the cliff."
SCJanuary 26, 2018 at 8:03 AM
"Massive selloff coming. Yes, it may be choppy and shallow to start with, but it will plunge deeper and deeper. Bottomless..."
We're still just working on the first red candle in the model haha! Massive downside ahead!!!
ReplyDeletethats probally the bottom in the market might seee a little lowewr then a pop up after trumps speach
ReplyDeleteBeautiful. Wait. Let's see some panic!
ReplyDelete"XIV has overheated and a reversion to the mean is likely in the months ahead.
When prices become this stretched from the normal, the move tends to be quite violent with a panic decline."
SC,
DeleteReversion to which mean? XIV $95 or are we talking more like long term support at $30?
$80 at the lowest for this move. $95 is probably conservative.
DeleteThe move to $30 is later in the model. Not important now.
your expecting 95 in this week or in this month
Delete$105 XIV early February. Bounce to XIV $130 and down to $80.
DeleteLargest point decline ever for XIV underway!
ReplyDeleteSCJanuary 9, 2018 at 2:11 PM
"Largest point decline for XIV since 2015 likely to begin shortly in my opinion. Within a few weeks..."
Thanks! Been patiently waiting with UVXY since Dec 28
ReplyDeleteOkay UVXY cooling off a little. The first candle of the model is complete. Still 2 more bars down to go. It'll be choppy and slower next as the decline continues.
ReplyDeleteSC, how far up do you see XIV going on the bounce? thx
DeleteGreat calls by the way, this is getting exciting!
Thank you! XIV $105 to $130 and down to $80.
DeleteThis is going to be an exciting year!! Unprecedented moves in volatility...
SC - could this be the whole initial decline with UVXY heading back to 10 now?
ReplyDeleteNo, I don't think quite yet. XIV see close to $105.
Deleteok cool, you think over the next two weeks it will slowly trickle down? Just wondering as massive hammer forming on XIV and inverted hammer on uvxy...typical of their sticksave action...
DeleteYes, trickle down next, exactly.
DeleteXIV fell below the 50dma so naturally it tries to recover with the daily hammer but this is about the weekly.
Weekly is in a sell and the decline won't end until the weekly is oversold. The daily will just keep becoming extremely oversold.
I could be wrong. Someone claimed that 12.00 would be hard ceiling for UVXY, period? Right? So I think no one has crystal ball, so be humble or market will give you the lesson. I did not loss on this round but would win a lot if I stick. But I am not regret as I had discipline to stop loss. Again, UVXY can fortune or widow maker, so Be Careful
ReplyDeleteMeasured move with the white box is at $25 for UVXY.
ReplyDeleteIs that in line with XIV at 105?
DeleteNo, the measured move is for the entire move. XIV would fall to $80 to reach that.
DeleteVix is testing August highs.
DeleteInteresting... Tomorrow, super blue blood moon!
ReplyDelete"On Wednesday, much of the world will get to see not only a blue moon and a supermoon, but also a total lunar eclipse, all rolled into one. There hasn't been a triple lineup like this since 1982 and the next won't occur until 2037.
"I'm calling it the Super Bowl of moons," lunar scientist Noah Petro said Monday from NASA's Goddard Space Flight Center in Greenbelt, Maryland.
Others prefer "super blue blood moon.""
trump doing his speech tomm market might pop
DeleteIn the daily time frame, XIV could see a small bounce as both the indices and XIV are oversold, but should continue the decline in the coming weeks.
ReplyDeleteDow plunges 400 points on track for biggest points drop since June 2016.
ReplyDelete3,000 more to go.
DeleteIf Dow plunges 3000 more points, which I agree with...won't XIV be lower than 80?
DeleteNo because remember XIV has been leading down for a few weeks already and no significant gains since December. In contrast Dow and SPX gained a lot in January.
DeleteSo now SPX and Dow should accelerate down to catch up.
ok very interesting. I like it SC!
DeleteDow and SPX especially on the second leg down accelerate down.
Deletewhat month will second leg take place
DeleteMarch.
Deletemarch 7 my bday will be a great birthday present
DeleteSo SPX say down to 2750 early feb, then bounce to 2850 and down to 2500s?
ReplyDeleteOnce this first leg down completes there is a big bounce and SPX might retest it's January high. Dow might even squeak out a slight higher high before the washout second leg down.
ReplyDeleteThe markets are all slightly weaker or stronger respectively.
Thank you SC, appreciate all of your guidance!!!
DeleteI'm glad vol has risen for you guys.
ReplyDeleteSC, when do you think this first leg down will complete?
ReplyDeleteProbably next week. VIX golden cross is imminent.
DeleteOften the cross coincides with a short term change in direction. Maybe UVXY pulls back more or not. Any way you look at UVXY there is more upside.
Deletea move above 283.30 would target 284.50 to 285.50
Deletea move below 281.22 would give us a signal for further downside
S&P 2798.03, hard bottom. After, VIX gets pushed to 12.8 or lower. UVXY 9.9 - 10.40
ReplyDeleteHonestly, from here, a surprise collapse in the S&P would be ok with me -- but I highly doubt it (see NYMO chart, and bottoms).
Trump about to release that 4 page FISA memo...could be the catalyst for 105 XIV soon...oversold bounces taking place...
ReplyDeleteMany catalysts hitting this month. The perfect storm.
DeleteIf we get to 105 XIV in the next week or so...SPX could be 100 points lower from here...Interest rates rising as well...
Deletehmm UVXY getting smoked...
DeleteBitcoin crash intensifying. Now in the $8,000's.
ReplyDeleteSCJanuary 16, 2018 at 3:04 PM
"Bitcoin has dropped to $10,000. $5,000 looks possible next."
SCJanuary 11, 2018 at 12:15 PM
"Bitcoin is crashing. It'll drag the market down with it."
bitcoin you are right again also your right with early pop in xiv nice call overthrew 130 though i sold half of my position in short and long at 13 going to buy back
Deleteuvxy needs to hold 10.23 support
ReplyDeleteChart Update posted!
ReplyDelete