TICK is Just as Blah - Volatility Isn't

There really hasn't been any underlying movement today, I suspect volatility is up as hedges are being put on, any large fund with significant long exposure saw the volatility yesterday and probably thought,

 "There's no way we can move 100k shares without crashing this position"

So the next option (no pun intended) as we have seen the VIX moving higher  is to hedge the long position with options, 2012 hedges are being rolled in to 2013 and many institutional traders who'd rather be flat or have less exposure right now are simply hedging that exposure, although this is nothing new, it's been going on the last several weeks, probably a month.

 This is the daily VIX with 20/20 Bollinger Bands applied, whenever a market average or other asset (but especially market averages) walk the upper band of Bollinger bands on a daily chart it shows extreme strength, the same goes for walking the lower band, extreme weakness. This is a reflection of big money trying to hedge their event risk (assuming no one actually nows the outcome of the meeting between the President and Congressional leaders).


 The 3C daily chart shows a strong positive divergence right at the pullback area in the VIx around November, this is when protection became cheaper to buy.

Here's the NYSE TICK chart for today up until the market started moving several minutes ago. As you can see, the range is mostly between -500 and +500 with a lot of time spent near Zero, there are very few extremes, this is a good measure of intraday market breadth and tells us the buyers/sellers are either evenly matched or more likely just not there and siting on the sidelines.