Tuesday, November 10, 2015

VIX Volatility Daily Chart

The bears flex their muscles yesterday. The VIX moves above the 200-day MA at 16.33 so the bears popped champagne corks and began celebrating. Bears win big above the 200-day while bulls rule below the 200-day MA. In mid-October, the bears were in the same position only to get punched in the face the next day so watch for follow-through today, or not.

Keybot the Quant remains short the market and is tracking VIX 18.15 as the key bull-bear line in the sand so the algorithm will not become excited for downside selling unless the 18.15 is taken out to the upside.

Very simply, VIX 16.33 tells you the market direction answer today; it is the only thing you have to watch. Bulls will throw confetti if VIX drops under 16.33. Bears will celebrate with more market carnage if volatility moves higher. Stocks will fall in earnest if VIX moves above 18.15. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Note Added 10:03 AM EST: VIX is 16.33. The 200-day MA is 16.33. That's funny. The fight is on after one-half hour of trading.

Note Added 10:10 AM EST: VIX 16.60 so stocks drift lower. The fight will continue today.

Note Added 10:01 PM EST: The bears got punched in the face. The VIX falls to 15.29 well under the 200-day MA at 16.33. The bears fold like a cheap suit and stocks float higher into the closing bell. Despite the big retreat in volatility, give it another day. Sometimes the markets are sneaky and they may be laying a bull trap. Bears need VIX above 16.33 or they got nothing.

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.