If I’m anything as a trader, I’m curious. I wonder constantly. What about this? What about that? How do these interact? What has happened historically in this particular situation?
Excel has been my go to fact checker for probably close to a decade now. It’s simple enough for me and does what I need it to do. It has also convinced me that I could never be a computer programmer. My go to condition checking formula is a basic if>then statement:
“IF this condition exists, (and this, or this, occur at the same time), THEN state it as the value of: (the upper bollinger, current price, 10MA + $5, etc.)”
They can get pretty complicated sometimes and anything beyond a few conditions and I’m likely to have a formula error because I missed a parenthesis or a comma, and then my eyes start to cross and my brain gets the blue screen of death. My solution in these cases is to break the formula down in a basic word doc and put it together piece by piece.
It has saved me what would doubtlessly have been countless hours manually checking dates for the conditions I want to check, a task so large I think it would have stopped me in my tracks.
Anyways, I’m noticing this morning that VIX is not really getting killed like I thought it might so I tested an idea out of curiosity…
The VIX 10MA and 20MA are both still climbing with SPX at ATH’s. How often does that happen?
Usually, it’s a quick check and I find the results to be too mixed to be very usable, but this time was surprisingly consistent and stopping trends in their tracks, except for a few times, most notably the 2017 melt up into the 2018 Volmageddon event so I thought I would pass it along.
Here are some charts. Cleaned up for simplicity. Black dots on price are when the the condition above was present. I went back to 2000, but there were no such events from 2000 through 2002.
Needless to say, the occurrences themselves don’t happen all that often. Maybe once a year? I’ll have to check if these coincide with tight weekly bollingers…
Let’s just say I’m not giddy bullish at this point in time.
Good luck, Slope!
