PROTECTION BEING BID SHORT TERM AND BLACK SWAN

I showed the SKEW chart last week (Thursday/Friday) as well as this morning, meaning deep out of the money Put premiums are out of whack with the norm as demand for them is seen in the rapidly rising SKEW Index which just so happened to be selling that same protection just prior to our base taking shape and bounce (interesting that people still think the market is reacting on its own to the events of the day rather than seeing these cycles are set up well in advance which is the reason we try to catch them at their pivots for entries and exits).

As we get closer to the end of the bounce (look for price to start flattening out, rounding over or forming a "W" or rectangle range- which was our forecast for this week) I whole-hearterdly expect to see short term protection in VIX futures and VIX short term Futures (VXX) bid. Interestingly, they have been showing strong activity the last few days and as you might expect after that last market update, strong activity today.

 Forget the 5 min charts for futures (although it's positive there too), the VIX futures 15 min chart is positive the last several days, the 15 min chart being a longer timeframe means stronger underlying flow.

Intraday there's a strong positive divegrence as well. it's the very flat range/support that is keeping me on the sidelines as well as the process that almost always takes place unless the market falls in to a panic fast.

Short term VIX futures (VXX) shows a 3 min leading positive today alone thus far, similar to the market averages' negative divergences today, selling in one, buying in the other. There's a clear shift among smart money toward a risk off position meaning our bounce (as expected for this week)  is running in to turbulence or "sheering".

 However, it's really charts like this VXX 5 min leading positive that are really interesting and catching my eye in combination with VIX futures.

We even have a sharp leading positive out to 15 mins.

At this point in looking at these charts, I'm very tempted to look at a call position or UVXY (2x leveraged long short term VIX futures), however it's the flat / support range and the potential for a head fake/stop run to pick up more protection on the cheap that has me waiting on this one.
 

The 1 min chart is a good timing indicator in this situation, I'd like to see a run of stops below the clear support level being built and then the 3C divegrence to lead sharply at that break of support so it looks more like the 5 min chart. At that point, I'd consider a VXX long even though I'm not a huge fan of VXX trading after enough experience. In any case, something is going on, whether this is the continuation/acceleration of the deterioration leading to the end of this bounce or the market is concerned about something else even more (because today's rate of change is much stronger than the deterioration trend from last week), I don't think it matter much; we're on the right track