Rare Batman Pattern Forming in the VIX

 

Just as it seemed as if the end of the world was nearing, I am pleased to report a rare Batman pattern forming in the VIX (and in the implied volatility of the SPX and SPY).

The chart below shows the right wing formed two weeks ago, just as panic was first setting in; the head was completed last week, when the situation looked most bleak; and now the left wing is taking shape as the forces of good seek to gain the upper hand over the forces of evil.

Once the batman pattern is completed, perhaps as soon as tomorrow, I can only conclude that Gotham City will likely be spared the full force of the financial Armageddon that appears to be bearing down on us.

Godspeed, Batman. Every minute counts…

Comments

[Stone Fox C...:]

Is this a legit signal?

2008 Oct 23 04:57 PM

[AlexS:]

Where's Robin?

2008 Oct 23 05:03 PM

[SCovert:]

Darn right it's legit.

What do we say to financial meltdown worries?

How about BAM!! ZONK!! WHAMMO!! Hand me the CDS-repellant BatSpray (TM), Robin!

Please forgive me for that, as ALL my stocks moved in a 10% range today. What? Yours did too?

2008 Oct 23 05:08 PM

[Moral Hazar...:]

I'd LOVE to buy puts on the VIX but when the VIX index goes down so will the implied volatility of those puts, and hence so does much of their value.

BAM!

DOUBLE-WHAM!

2008 Oct 23 05:29 PM

[Mr. Math:]

you crack me up

2008 Oct 23 05:33 PM

[X-15:]

Riddle me this Batman..

2008 Oct 23 06:36 PM

[Muzie:]

"I'd LOVE to buy puts on the VIX but when the VIX index goes down so will the implied volatility of those puts, and hence so does much of their value."

Well if it's so easy there's nothing keeping you from selling them.

2008 Oct 23 06:56 PM

[2houndz:]

You can also draw declining parallel trend lines across the top and bottom of that formation AND there is a definite wedge forming in the the DJI over the same period. Normally I would say that a wedge consolidation in a bear market means more considerable downside, but the VIX pattern makes me think we have a dead cat bounce in our future....
We shall stay tuned and see.

2008 Oct 23 07:33 PM

[Smarty_Pants:]

"Sure'n begorah, I forgot to turn off the spotlight."

Chief O'Hara

2008 Oct 23 09:24 PM

[moonbat1775:]

too technical for me.

2008 Oct 24 06:57 AM

[Augustus:]

Amok,

Sell the Calls.

2008 Oct 24 11:43 AM

[carey_jim:]

Luby, I think you've gone over the top on this one. It might be time for detox.

2008 Oct 24 12:58 PM

[DaveW:]

Damn Luby, thought we were in for a little help from the Dark Knight, until the Batman's left wing just got a bounce. Clearly, he will spiral in circles from the asymmetry... HOLY GLOBAL-CHAOS! The market is following our caped crusaider down!

2008 Oct 24 02:01 PM

[Vox Rationalis:]

Whoops. Batman seems to have grown a tumor on his left arm. God save us all.

2008 Oct 24 04:05 PM

[DaveW:]

aahhh yes, it has led to an even more rare "Batman-with-left-wing... VIX pattern (sounds like something MoveOn.org should deal with!)

Bill,
Thanks for injecting some fun into this molten hell we call the market. I don't know what made me laugh harder, your post or stone fox capital's comment. too damn funny.

2008 Oct 24 06:38 PM

[DaveW:]

great. a humor buzz kill but I have to correct the glitch: that's "Batman with left wing tumor" VIX pattern.

2008 Oct 24 06:40 PM