Wednesday, January 8, 2014

Some Smoke...

While there seems to be a small effort to push VIX futures down and ramp the market a bit in to the close (nothing spectacular so far), the one thing I was looking for today in the market did occur, in different averages to different degrees.

The VXX was/is the real smoking gun and while it has been steady and systematic, it looks like that smoking gun may be forming up which is just about the right timing (remember VIX moves opposite the market for the most part.

Also the Index futures 5 min charts, it's hard to justify a long or a long bias with 5 min charts going from positive to yesterday , in line to today negative.

 The intraday SPY was going negative yesterday, I suspected it may move more negative which it has today while remaining in a range and not adding to yesterday.

This is a VXX 10 min chart, earlier I saw improvement here, but nothing standing out, this is really starting to stand out and has worked well for a reversal timing indicator when it really stands out.

ES went from positive, gave us the gains we were looking for yesterday, but was in line, I suspected since the upside was expected to be of short duration, that we'd see some deterioration, this 5 min chart is leading negative.

I use these 5 min charts a lot to determine trading positions, the trading portfolio is now biased to the short side with hedges removed.

*I will say the tone of trade since the start of the year has been much different, today is the most extreme example of that.

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