Click here for Signal Trades spreadsheet. Updates 12 PM ET - Wednesday Sell order got filled for SOXS We may have been too conservative in estimating today's sell-off, but pocketing partial profit is still a good thing. For info on how this SOXS position was entered, click here. Updates 11:31 AM ET - Wednesday Key support zones coming up Things got bearish faster and deeper than we expected, but we did expect the selling to happen.
This Level 2 dip is not technically done yet. We need a clearer top on VIX VVIX UVXY charts. Also in terms of timing, we may see choppy bottom starting to form for the remainder of this week. NQ SOXL may not start to rise back up the channel until Monday. Our sell order for SOXS position got filled. If you are still holding SOXS, it may go as high as 21.75 - 22. Updates 12:55 AM ET - Wednesday Upcoming key events VIX UVXY still suggesting Level 2 dip is in progress VIX 30-min chart below shows a rising 200 EMA green line. As well VIX 20 EMA blue line and 50 EMA red line have crossed above the 200 EMA green line. This implies that the dip is still in progress. Instead of looking at UVXY chart, sometimes it's more helpful to analyze the inverse SVIX chart. Observe that SVIX has formed a top since July 12, and is about to drop out of the bottom of its purple channel. The last 2 times this happened, the Level 2 dip accelerated into a climax. We may very well see that between now and early next week. VVIX 30-minute chart pattern is currently unclear. So we cannot draw a conclusive message from its chart right now. NQ
SOXL
We entered into half position of SOXS after CPI Thursday morning. We plan to exit at the bottom of SOXL choppy range and wait for SOXL setup. Click here for Signal Trades spreadsheet. Disclaimer The information presented here is our own personal opinion. Consider it as food for thought. We are not offering financial advice. We are not promoting any financial products. We are not registered financial advisers or licensed brokers. We make no guarantee that anything will unfold according to our projections. You are proceeding at your own risk if you follow our trades.
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Click here for Signal Trades spreadsheet. Updates 4 PM ET - Thursday Entered into SOXS bear position right after CPI Ahead of CPI report, we wrote: Look for the scenario where VIX dips right after CPI to get close to 12 once again. After this last anchoring process, VIX may then start to spike. This scenario means NQ SOXL will likely rise some amount post CPI. That is pretty much what happened post CPI. After NQ SOXL both spiked up sharply, and VIX dropped sharply, we observed a dramatic reversal. So we entered 1/2 position SOXS as planned. We decided not to add to this position because SOXS was taking off too fast, and this is just a Level 2 dip which means the dip won't be that big or lasts for that long. Updates 2:15 AM ET - Thursday Upcoming key events VIX VVIX UVXY: Patterns building up towards a Level 2 dip setup By end of day Wednesday:
You can see these patterns in the charts below. Does this mean Level 2 dip is officially starting? These charts above suggest that VIX VVIX UVXY are now starting to generate bearish conditions for equity, conditions that typically lead to a dip, a Level 2 in this case. But bearish conditions do not mean that NQ SOXL will drop instantly into a dip. Bearish conditions mean bulls should think about protecting your profits. Bears can monitor for setups to short. But the setups have to be really "ripe", and the short positions probably will not last any more than 3-4 days. NQ
SOXL
Until we see a clear short setup on SOXS charts, we are not entering anything yet. But in the spreadsheet, we have shown a possible buy order for SOXS trade setup just to give you an idea of what to look for. Click here for Signal Trades spreadsheet. Disclaimer The information presented here is our own personal opinion. Consider it as food for thought. We are not offering financial advice. We are not promoting any financial products. We are not registered financial advisers or licensed brokers. We make no guarantee that anything will unfold according to our projections. You are proceeding at your own risk if you follow our trades. |
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