There is a lot of confusion about the VIX’s high today, because I’ve been stating over and over how I’d cover everything between 22 and 23 on the VIX. The VIX peaked at 20.56 today, as shown with this intraday chart:
Slope of Hope Blog Posts
Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.
Why I Shorted Tesla
I first offered up the insane idea of shorting Tesla back on September 15th, then I followed up with the same notion on September 22. My reasons were simple: (a) their persistent delays in rolling out the Model X were pissing off their most loyal devotees, like yours truly; (b) failed bullish breakout, shown in yellow below; (c) affirmation on the failure with a trendline break and retest, highlighted in magenta. It all added up to a great reason to short the stock and go long the put options, both of which have paid off nicely. Elon, you really should focus on getting the X out the door before you start monkeying around with new models that aren’t that important to people!
Volatility on SPX:VIX Ratio Pair at Critical Level
I last wrote about the SPX:VIX ratio in my post of August 15th. I mentioned that failure to hold above the 150.00 level would likely see a prior gap up filled, while a break and hold below the 110.00 level would likely see a larger-scale correction begin in equities.
Since that date, price on this ratio finally fell below 150.00 on September 22nd (after re-testing that level and rallying on a dead-cat bounce), as shown on the 20-Year Daily chart below, and closed today (Thursday) just above the 100.00 level (filling the gap in the process). This increase in volatility is not surprising after this ratio pair put in a massive outside bearish engulfing candle on the Monthly timeframe, as I had noted in my post of July 31st. (more…)
In the Shadow of a Volcano
The very strong decline yesterday caught me by surprise, as we had a very nice setup to retest the highs and a strong daily buy signal to back that up. I was expecting SPX to hold the 1940-50 area in line with fib retracement targets and that didn’t happen. So where does that leave us this morning?
Well in terms of the buy signal these are most immediately bullish in the context of a supportive pattern setup. We had one yesterday morning and we don’t have it now. The very nice double bottom setup is badly, and most likely fatally, damaged. I’m not a big believer in triple bottoms, which are rare, and tend to be raised as a possibility mainly when a possible double bottom is in the process of coming apart. The falling megaphone target back at the highs was only really interesting in the context of that double bottom. My megaphone targets as counter-trend patterns are the standard range of fibonacci retracements, and this one has already retraced slightly over 50% of the megaphone move. (more…)
