VIX 01 (Jun 09 - Oct 11)

[kennynah]

Winston :

VIX is a tradable counter....I wonder if you would consider relocating it to "stocks" thread...

[kennynah]

13Dec09 - Weekend Review of US Market Direction

I cant tell if VIX will move one way or the other based on its daily chart pattern...

However, I do anticipate that it may be about time that it "show hand" this coming week.... of cos, i am bias for the upside...

How about you?

[winston]

Winston :

VIX is a tradable counter....I wonder if you would consider relocating it to "stocks" thread...

Done.

[kennynah]

roll of the dice.....

[cboenews]

Nice post. They have a monthly chart of the VIX/SPX since 2008 on the CBOENEWS site.

http://cboenews.com/10-29-2009/

Hope you like it!

Robert
CBOE Advocate

[winston]

I dont trade US stocks but if I'm trading US stocks, I would be long the VIX now.

I will forget about looking at the charts and just focus on the big picture. The big picture is that the VIX is quite low now. Yes, it can get lower but if you are managing your risk properly eg. not too leveraged, accetable position size, Stop Loss etc, I think it the reward would justify the risk.

I will have some "Time in the Market" rather than to try to "Time the Market", on this trade.

Use the info above at your own risk. Not vested. And if you make money, the forum would appreciate if you would invite more of your friends over

[kennynah]

i agree with W's macro-outlook...

additionally, VIX can never get to ZERO.... unless, they decide one day to shut down the options exchange or sp500 index trades at zero value, which is extremely unlikely....

VIX recorded its lowest point at ~ 9 and the highest at 89.53..... now that it is at 21.49, i too concur that there is more upside reward to downside risks.....in the long haul....

[winston]

This Fear Indicator Put the Bears in Charge for Now By Jeff Clark

If you want to know what's going to happen between now and the end of the year, then keep an eye on the VIX.

We've kept close tabs on the Volatility Index in Growth Stock Wire this year (click to read my essays from March, September, and October). It's proved to be a good indicator of short-term market direction. Now, with the stock market confined to a tight, month-long trading range, and with volume drying up as Christmas and New Year's Day approach, it's worth taking another look at this crystal ball.

The VIX is best used as a fear barometer. A rising VIX shows increasing fear among investors and is commonly associated with declining stock prices. A falling VIX, on the other hand, indicates investors are less fearful and more willing to take risks. It often leads to rising stock prices.

Take a look at this 60-minute chart of the Volatility Index...

This chart measures the action in the VIX during 60-minute intervals over the past two weeks. Now, compare that chart to this one of the S&P 500 over the same time frame...

It's almost a perfect inverse correlation. While the VIX has been falling and forming a bullish falling-wedge pattern, the S&P 500 has been tracing out a bearish rising wedge.

Both charts broke out of their wedges during the final hour of trading yesterday. When a chart breaks out of a wedge pattern, it often leads to a sharp, fast move in the direction of the break. The VIX chart broke to the upside. If it plays out, we could see the VIX rally back up to the December highs near 24.

Of course, that action will pressure stock prices, and we could very well see the S&P tumble down to the lower end of its trading range, near 1,090, over the next couple of weeks.

Keep in mind, we're looking at 60-minute charts – which are best used to analyze short-term market movements. They say nothing about the longer-term direction of the market.

But if you're looking to trade stocks over the next two weeks, the VIX suggests the bears will have the upper hand... er, paw.

http://www.growthstockwire.com/

[b0rderc0llie]

Haha, let me try out the VIX

Am long the Volatility Index Jan 2010 Futures at 24.4. Let's see how it goes...

[winston]

Hi BC,

I dont follow this very closely. Intuitively, I may go for something a bit further out but that means that you may not be able to get that much bang for your buck.

Good Luck !

Take care,
Winston