Click here for Signal Trades spreadsheet. Updates 1:30 AM ET - Monday Upcoming key events Read more economic analysis here. Friday’s job report was unexpectedly robust. This sent stocks up and bonds down, and created a lot of bullish chatter on social media. Let’s see if the charts actually confirm the bull case or not. VX (VIX futures) While VIX represents the market’s expectations for volatility, VIX futures represent the true demand of volatility hedging products by hedge funds and financial institutions. Lately we find that this demand is the true tell of the mood of major market participants. It is clearer than looking at just VIX alone. VX weekly chart below provide some key levels that we need to monitor for the bull case vs. bear case. Bullish (for equity): If VX stays under 21 and forms a lower high top, it can coil its way down to 17.6 first, and then eventually to 14.68. This steady drop would provide bullish tailwind for stocks. Bearish (for equity): On the other hand if VX rises above 21.33, then it may surge very rapidly to 27.5. This volatility surge will result a substantial drop for NQ SOXL TNA. They will drop to S2 levels or lower. So how do we monitor VX for this key move? Look at VX 15-minute chart, shown below. Bulls will want to see VX 20 EMA blue line rises back up and forms a lower high top clearly. If instead this line keeps rising up sharply, then the bear is coming back. NQ
SOXL
TNA
Our personal trade plan We are not planning on buying or selling any position until VX reveals its next move as outlined above.
Buy orders will be provided as VX UVXY SOXL reveal their next moves. 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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