SPY -VIX 5 PT RALLY-Buy Signal last Friday Aug 30
I have posted several times in the past about market signals generated by shifts in the value of the VIX index. The general conclusion (up until last September) was that the average rally in SPY was 3.5 points in the 10 days following the signal, but along the way there was an average decline of 3.4 points.
The signal is a simple 5 point INCREASE in the value of VIX, on a closing basis.
Lately, however, there have been a multitude of signals that have been EXTREMELY profitable without much risk.
It looks like we are in another very profitable trade here too, and it is profitable right away without looking back. The problem is this time the financial stocks are weak and rolling over. It could be that we are in a technology led-blowoff in the overall market where only the tech stocks participate while the rest of the market experiences selling pressure.
Notable weakness in the drug stocks, retail and financial stocks. The oil stocks are coming out of bases, so that is the new leadership but that isn't leadership we want to see at this stage in the bull market. That is what ENDS bull markets, in my opinion.
So, we shall see what happens. The signal was last Friday, August 30. We are in the fourth day now and past the half-way point of the average gain. I feel like this is a good time to exit out of this trade and maybe go the other way and look for some "blue box" to paint on this chart on a move down to 161-160 next week.
Tim 11:39AM EST, Friday September 6, 2013
The signal is a simple 5 point INCREASE in the value of VIX, on a closing basis.
Lately, however, there have been a multitude of signals that have been EXTREMELY profitable without much risk.
It looks like we are in another very profitable trade here too, and it is profitable right away without looking back. The problem is this time the financial stocks are weak and rolling over. It could be that we are in a technology led-blowoff in the overall market where only the tech stocks participate while the rest of the market experiences selling pressure.
Notable weakness in the drug stocks, retail and financial stocks. The oil stocks are coming out of bases, so that is the new leadership but that isn't leadership we want to see at this stage in the bull market. That is what ENDS bull markets, in my opinion.
So, we shall see what happens. The signal was last Friday, August 30. We are in the fourth day now and past the half-way point of the average gain. I feel like this is a good time to exit out of this trade and maybe go the other way and look for some "blue box" to paint on this chart on a move down to 161-160 next week.
Tim 11:39AM EST, Friday September 6, 2013
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