Entry/exit signals for SPY QQQ TQQQ IWM SPX NDX based on VIX.
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Updates 11:29 AM EST - Monday 1/4/21
$VIX $VXN rose as projected
Just as we projected on Sunday, $VIX $VXN both rose sharply starting at open this morning.
$SPX $NDX IWM dropped correspondingly. However, certain sectors temporarily survived $VIX $VXN bearish headwinds and rose instead. $SOX was one of those sectors, which greatly benefitted our SOXL position.
At this point, in Signal Trades we have manually exited TNA due rising $VIX. We also tightened SOXL stop and got stopped out. Both trades yielded decent profits. See Signal Trades for trade history and current position. We have now booked 184.6% in profit since July 2020.
There is a chance that the current elevated levels of $VIX $VXN may persist through Wednesday this week. This market is still quite bullish, but it is nervous about the runoff election in Georgia on Tuesday, and the vote certification by Congress on Wednesday.
Updates 7:50 PM EST - Sunday (for Monday 1/4/21)
Welcome back and Happy New Year!
Expect some turbulence early this week from $VIX $VXN rising moderately. Still bullish in the big picture for $SPX $NDX IWM.
Market internals still continue to diverge bearishly from $SPX $NDX IWM prices. With $VIX $VXN sending short-term bearish messages, bulls should proceed with caution.
As we mentioned above, $VIX and $VXN were sending out short-term moderately bearish messages on the last trading day of 2020. This combined with the bearish divergence from market internals means that the bulls should proceed with caution here.
$VXN 2-hour chart below shows that $VXN has a good chance of surging quickly up to about 31, before it drops lower. If this setup unfolds this way, it is actually favorable for the bulls. It can trigger a dip in $NDX, relieves some selling pressure and brings in new buyers.
Read the rest of this analysis, and get the latest entry/exit signals for SPY QQQ TQQQ IWM SPX NDX based on VIX here.