Market Currents

The ferocity of the recent reversal in the VIX (VXX) - from 20% above its 10-day moving average...

Tuesday, January 8, 3:55 PM ET
The ferocity of the recent reversal in the VIX (VXX) - from 20% above its 10-day moving average to 20% below within a month - has occurred just 4 other times going back to 1990, writes Adam Warner. Is it a tell? Unfortunately not likely, says Warner, as no pattern is evident from the previous instances.

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This news story has 8 comments:

Jeff Hartzer Comments (6)

The only pattern with VXX evident to me especially in last three years, is that it FALLS more rapidly than it rises. The recent REVERSE SPLIT was a horrible thing for those holding VXX at the time. My opinion of course as a great big VXX 'loser'. When VXX hit 37 recently, I should have sold all of my shares (still at a large loss for me)...My personal history with VXX is a long one and don't tell me to not hold long. Too late for that. The Japanese Tsunami of water and financial ruin killed thousands but VXX was 'high' afterwards...Must we wait for a real Mayan Asteroid to be saved from the rigors of VXX? Hope not.

8 Jan, 04:22 PM Reply Like

kjkoprowski Comment (1)

Need to look at UVXY with the MFI Indicator. I set it up with a 5 day parameter. You'll see that over the past few months several times it will touch zero, time to buy, and as soon as it hits 80 ( overbought) it sells.
Just bought again at zero. Let me know what you think.

9 Jan, 03:31 PM Reply Like

MarcJoli Comments (60)

I see that VVIX (the VIX of VX) dropped to a multi-year low, an extreme low, at the same time as VIX dropped. This one means that VIX options players are not willing to bid up the costs on Jan and Feb month VIX options contracts (calls and puts).

From other commentary I have heard, it looks like the VIX options players are more interested in playing with March and April options at the moment.

Who knows if they are right or wrong , but assuming this is smart money, I think it means we have weeks or a month of "all clear" for the market bulls and volatility shorters.

8 Jan, 04:32 PM Reply Like