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I am a 41 something year old male. I have worked for UPS for over 20 years. I am investing for financial independance and the joy of finance. I believe in Nanotech, Robotics, and the next revolutionary technology. I learned to invest before the internet bubble (with no money), and started... More
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  • Prognostication Volatility TVIX BAckwardation Technical Flag "Ebony Fowl" 0 comments
    Aug 10, 2014 2:42 PM


    The current situation is going to bring about a financial crisis. My rudimentary technical skills and several years of watching, studying, trading, and contemplating Volatility have determined a market correction (10%-35% down intraday) is eminent. This will result in the VIX rising rapidly and the corresponding leveraged ETF's rising faster if the Futures market shifts from contango to backwardation. Hopefully, after that, the market will be present and Volatility will return to a new normal (more than 10 I assure you).

    There are so many potential "ebony fowl"s flying around that any two could collide. A healthy, normal correction is needed and long over due but the fragility of certain segments of the global economy and perhaps the entire system compounded by and/or triggered by Our feathered harbinger(s) could cause a very unhealthy crash hobbling the recovery that should follow.

    My stop loss strategy has left me mostly in cash again. I did have 2000 TVIX left over from the drubbing of the last months and it is up from 3.14 to 4ish. It is time to get long five figures of shares for me in a volatility ETF. If I can time it properly (forgive me) I can limit my potential loss to 10% while trying to get in a profitable trade protected by a rolling stop loss order. If my crystal balls are accurate I can make a fat profit on the financial wreck and then be in a cash situation to build my portfolio for the long haul on the cheap. Robotics, 3D printing, Nanotechnology, and dividend stocks all bought at a nice discount to today's lofty price levels will be the goal of this misadventure.

    If something catastrophic happens ,i.e. currency crisis, we are all toast anyway so this tactic is being implemented to further a strategy that does not include economic Armageddon.

    Note: price trending upward over 50MA with rising volume. I wish I could obtain the Short Interest. If nothing happens before expiration of derivative contracts in a week or so the price will collapse. The NAV is currently above the price and besides the discount on the share purchase this imparts I believe it to be a confirmatory indicator of the flag flying on that little pole.

    (click to enlarge):stockcharts.com

    P.S.. I pray we can just have a salubrious trepanning while not causing the patient to expire...

    Disclosure: The author is long TVIX.

    Additional disclosure: I am going to get longer tvix

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