The markets have entered the whipsaw phase.
UVXY should decline next week into Friday, and spike again to test the orange resistance later this month. Volatility to continue, and increase in the following months.
2day Chart
Before:
January 9th, 2018 analysis:
"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
Managed to sell UVXY at $30 yesterday right at the orange resistance. 18 cents from the high.
ReplyDeleteThe trade took a lot of patience, but once it melted through the midfork at $18 the next level to watch was $30.
DeleteI know I certainly enjoyed the panic.
ReplyDeleteSCFebruary 1, 2018 at 10:48 AM
"So we may see a washout low next week to complete the first leg down.
A dose of panic..."
thanks for chart
ReplyDeleteSC could we see a retest of the SPX low this week followed by rally into next Friday?
ReplyDeleteYes we could. Prices should decline into Friday this week. Next week looks very strong for SPX.
DeleteXIV wasn't able to withstand the reversion to the mean, and was wiped out completely.
ReplyDeleteLOL at your bottomless comment in the previous thread :)
DeleteIt truly was bottomless.
DeleteSCJanuary 25, 2018 at 10:51 AM
Delete"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..."
I'm expecting UVXY to close this week around the orange midfork. $18 approximately.
ReplyDeleteThen UVXY sink next week.
Uvxy short covered if it hits 18 maybe I'll short it
DeleteXIV and the bubble involving Issac Newton.
ReplyDeleteSCNovember 22, 2017 at 6:39 AM
"I identified early in the year that XIV was likely configuring to make a parabolic move up. That has occurred, and it is approaching exhaustion. The last few days XIV has very extreme gap ups which tells me this move is in the terminating phase.
I chose not to play this move because it's just too dangerous. When XIV turns down it'll freefall with no warning and trap those who are in it. So I don't play that game. Have a look at my post about Issac Newton and the South Sea bubble."
SCOctober 6, 2017 at 9:09 AM
"Don't be an Isaac Newton hahaha!!!"
"Back in the spring of 1720, Sir Isaac Newton owned shares in the South Sea Company, the hottest stock in England. Sensing that the market was getting out of hand, the great physicist muttered that he 'could calculate the motions of the heavenly bodies, but not the madness of the people.' Newton dumped his South Sea shares, pocketing a 100% profit totaling £7,000. But just months later, swept up in the wild enthusiasm of the market, Newton jumped back in at a much higher price — and lost £20,000 (or more than $3 million in [2002-2003's] money. For the rest of his life, he forbade anyone to speak the words 'South Sea' in his presence."
http://www.businessinsider.com/isaac-newton-lost-a-fortune-on-englands-hottest-stock-2016-1
Interestingly XIV followed the exact same time frame as the tulip bubble of December 1st, 1634 to February 5th, 1637.
ReplyDeleteFor XIV is was December 2015 to February 5th, 2018.
2 year parabolic run for both, and crashed on the exact same day!!!
LOL only bitcoin is left now to go to zero :)
DeleteI have a plan for bitcoin...
Deletekeep me in mind gbtc possibly
DeleteVIX chart coming soon. Have been saving it for the right moment...
ReplyDeleteVery surprised XIV didnt just do a reverse split to stay solvent.
ReplyDeleteAre you expecting a 2011 redux for long volatility this year?
UVXY will dwarf the 2011 move.
DeleteThe 2011 move was 700% over 2 months. UVXY just spiked 350%.
I've modelled UVXY and the numbers are impressive. However, it's very different this time. Spikes, drops, and whipsaw phases. It'll take much longer than 2011.
2011 was a crash.
The reason is no crash in SPX this time. The bear market is brewing, slowly approaching.
XIV and SVXY math explained in this article. Basically the mother of all short squeeze as the overcrowded trade unwound.
ReplyDelete"•Two volatility products were forced to buy a large number of futures contracts in a short amount of time after the market closed."
"estimates that the two volatility funds had to buy as much as 100,000 futures contracts in as little as 10 minutes."
https://www.cnbc.com/2018/02/07/volatility-trades-had-out-sized-influence-on-the-markets-free-fall.html
Contrats on the UVXY call SC, hopefully everyone was as nimble as you to get out before it collapsed yesterday.
DeleteOn XIV, anyone with any understanding of the product should have sold last Friday when VIX futures went into backwardation. The question is why did the price not collapse on Monday, VXX was up 33%, XIV should have been down at least that or actually much more. Who could possibly have been keeping the price up right until the close with the VIX having ramped 100%.
VIX largest one day spike in history on Monday February 5th.
ReplyDeleteDow one day largest drop in history.
So what you're saying in the nutshell is that uvxy will go down to 9 or 10 then go up 700%
DeleteNo, the initial move is sizable but will not be that large. It's best to approach this in phases. We are only in the 1st phase.
DeleteOne step at a time.
SPX chart is coming...
ReplyDeleteNew chart posted!
ReplyDelete