VIX Technicals
Almost everybody saw the bear market coming and a lot of them are still calling for a recession. There are ways to beat the bear market. You an go with negative leveraged shares. You can go to safe havens. Or you can follow the VIX. You can invest in the Volatility Index as it usually goes up during a market downturn in a recession. You can also use the Index to judge when a potential market crash will happen during a recession. It can also signal if a recession fears are receding.
Its a new Quarter. Its the second half of the year. Lets see how the VIX is looking before we officially start fresh on this new quarter and for the rest of the year.
I know some of you don't trade off of technical levels. But I live by them. They feed me and pay my rent. Just watch for these levels I mention and watch for the volume to pick up drastically at these levels. Watch for a reversal or a breakout. You may even see a very important news headline that can move a stock or the whole market at these levels. I see these things happen all the time at strong long term technical support and resistance levels. Its not 100% of the time but when it does happen you will have a good trade that you can be confident in. Just watch and you will see.
$VIX Index Futures(MAY4)(VXmain.US$
Its a new Quarter. Its the second half of the year. Lets see how the VIX is looking before we officially start fresh on this new quarter and for the rest of the year.
I know some of you don't trade off of technical levels. But I live by them. They feed me and pay my rent. Just watch for these levels I mention and watch for the volume to pick up drastically at these levels. Watch for a reversal or a breakout. You may even see a very important news headline that can move a stock or the whole market at these levels. I see these things happen all the time at strong long term technical support and resistance levels. Its not 100% of the time but when it does happen you will have a good trade that you can be confident in. Just watch and you will see.
$VIX Index Futures(MAY4)(VXmain.US$
VIX has been killing the markets for the first half of the year. If you don't know the VIX then when the VIX goes up then the market, or SPY, generally goes down. When fears of a recession are iminent the VIX will be at a historically high price point. When recession fears are receding then the VIX will be at a lower level or falling in price basically.
The VIX has been in a wide upward price channel since last November. I believe it was right around the time Putin started putting troops on the border of Ukraine and also the Fed first started hinting towards rate hikes. An upward price channel doesn't happen on the VIX very often. It is conducive of very bad market conditions, like Quantitative Tightening, or a Russian War. I've highlighted the price channel below in purple. VIX could very well follow this price channel which would keep bringing SPY down with the market slowly like it has the past several months.
Another thing Im watching on the VIX like a hawk is the current position it sits at. It is directly below a long term trending resistance that stretches back to the pandemic stock market crash. You can see the resistance level below highlighted in purple. If we rise above this level with a big spike in volume and a lot of momentum in price action then it will get ugly in the market. If we just creep above slowly and the market drips down slowly then I will assume we are remaining in the price channel mentioned above.
The last major thing I am looking at on the VIX's charts is the major resistance levels I have highlighted by the yellow horizontal lines. Right now VIX is at a historically high level as it has been rising for several months. When the price of VIX gets above that 40 dollar level that I have marked then it usually has corresponded with a very big market correction or even a complete market crash. So those yellow lines are my point of no return for the market.
Below you can see a close up on the 4 hour candles how volatility is picking up as buyers and sellers battle this major long term resistance level out.
Below you can see a close up on the 4 hour candles how volatility is picking up as buyers and sellers battle this major long term resistance level out.
One thing I am not watching for is the VIX to just completely break down and SPY to skyrocket. Although that would be great. The market conditions are just not accommodative enough for that to happen. But then again when everybody is shorting the market then the market will just skyrocket, squeeze and skyrocket more.
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With all that being said, how do you think the second half of the year will go.
With all that being said, how do you think the second half of the year will go.
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SpyderCallOP : I just noticed the big typo in the picture of the chart
SpyderCallOP : "RESISTACE." what the heck does that mean?
Red__Bull SpyderCallOP: COVFEFE
1994CM : Not sure when the current Bear Market will last?
1994CM : Not sure when the current Bear Market will end?
SpyderCallOP 1994CM: im not sure at all. It looks like the market is trying to form a temporary bottom for now. but market conditions are not good for stocks due to the bad macro economic environment. A lot of downside has already been priced in so maybe the market is waiting for more bad news before taking another leg down