VIX needs to go down for bullish on all coins and stocks% waves down, and a correction to the 382 fib. If we go down from here we should see some really nice waves on crypto and stocks.
VIX trade ideas
Will the Fear Gauge Flash Red?The Cboe Volatility Index (VIX), Wall Street's closely watched "fear gauge," is poised for a potential surge due to US President Donald Trump's assertive policy agenda. This article examines the confluence of factors, primarily Trump's planned tariffs and escalating geopolitical tensions, that are likely to inject significant uncertainty into the financial markets. Historically, the VIX has proven to be a reliable indicator of investor anxiety, spiking during economic and political instability periods. The current climate, marked by a potential trade war and heightened international risks, suggests a strong likelihood of increased market volatility and a corresponding rise in the VIX.
President Trump's impending "Liberation Day" tariffs, set to target all countries with reciprocal duties, have already sparked considerable concern among economists and financial institutions. Experts at Goldman Sachs and J.P. Morgan predict that these tariffs will lead to higher inflation, slower economic growth, and an elevated risk of recession in the US. The sheer scale and breadth of these tariffs, affecting major trading partners and critical industries, create an environment of unpredictability that unsettles investors and compels them to seek protection against potential market downturns, a dynamic that typically drives the VIX upward.
Adding to the market's unease are the growing geopolitical fault lines involving the US and both China and Iran. Trade disputes and strategic rivalry with China, coupled with President Trump's confrontational stance and threats of military action against Iran over its nuclear program, contribute significantly to global instability. These high-stakes international situations, fraught with the potential for escalation, naturally trigger investor anxiety and a flight to safety, further fueling expectations of increased market volatility as measured by the VIX.
In conclusion, the combination of President Trump's aggressive trade policies and the mounting geopolitical risks presents a compelling case for a significant rise in the VIX. Market analysts have already observed this trend, and historical patterns during similar periods of uncertainty reinforce the expectation of heightened volatility. As investors grapple with the potential economic fallout from tariffs and the dangers of international conflicts, the VIX will likely serve as a crucial barometer, reflecting the increasing fear and uncertainty permeating the financial landscape.
VIX structure is becoming like 2022 pointing to deeper dipThe VIX is following similar pattern to 2022 and gradually increasing. Using that pattern, I can compare current spx to 2022 and draw a channel to 2022. then we have a way down to go.
I also agree with ContraryTrader's post on spy
specially his observation on Wyckoff distribution. I have been following the news and I know that big investors like Warren Buffet and Michael Burry have been selling heavily last year because it was overvalued.
So if they have sold off, would they buy back with 10% correction? They would be looking at at least 30% correction before they start buying back. Now combine that with tariff wars!
Stocks and Yields Signal Trouble as VIX Approaches Key ResistancThe Volatility Index (VIX), commonly known as the market's "fear gauge," has reached a critical juncture, testing the pivotal 2-year support/resistance level at 18.80. Following a dramatic 40% decline from its recent high of 29.20 to 17.32, the VIX has established a symmetrical triangle pattern, indicative of an imminent breakout. Major U.S. indices, including Nasdaq, S&P 500, Dow futures, and the 10-year Treasury yield, are retreating from recent rebounds, which increasingly resemble a classic "dead cat bounce" rather than sustainable recovery.
The alignment of these indicators suggests the market sentiment remains fragile, raising the probability of further downside momentum.
Technical Breakdown
Volatility Index (VIX)
The VIX is testing critical resistance at 18.80 after rebounding from the 17.30 zone. A symmetrical triangle pattern has formed, signalling potential volatility expansion.
Immediate Bullish Scenario: Holding above 18.80 targets an initial rise toward 21.25 (triangle midpoint). A break above this level significantly increases the odds of a climb to 22.80 and subsequently to the triangle's upper boundary at 25.24. Beyond 25.24, the VIX could quickly escalate toward prior resistance zones at 26.75 and the recent high of 29.20.
Bearish Scenario: A decisive break below 17.30 would temporarily alleviate bearish equity pressures but remains unlikely in the current uncertain climate.
Backwardated Volatility Curve: A Thesis on Fear and OpportunityWhen the ephemeral grip of fear tightens, it often manifests as a divergence in the volatility landscape. Specifically, when the immediate dread, captured by spot VIX, surges beyond the horizon of longer-term anxieties, represented by VIX 3M, a unique market condition arises: the inverted, or backwardated, volatility term structure.
Beyond a mere statistical anomaly, this phenomenon paints a vivid portrait of market psychology. The thesis posits that such an inversion reflects a market bracing for immediate shocks, a perception of heightened risk that overshadows longer-term outlooks. In essence, fear is front-loaded.
The implications are profound. This surge in short-term implied volatility, driven by a desperate scramble for immediate protection via options, can trigger dramatic price swings. In its heightened state, the market often succumbs to panic, driving asset prices lower. Yet, the contrarian thesis finds its footing in this very panic, this acute manifestation of fear.
The core argument rests on the dichotomy between panic and fundamentals. While short-term volatility spikes may reflect a visceral reaction to immediate threats, the longer-term view, as expressed by VIX 3M, suggests a belief in the eventual dissipation or moderation of these uncertainties. Thus, the inversion becomes a signal, a potential harbinger of near-term capitulation.
Historically, when spot VIX eclipses VIX 3M to levels associated with market troughs, astute observers recognize an opportunity. The logic is compelling: once the immediate storm passes, spot VIX should revert, realigning with or falling below VIX 3M. This normalization and the potential for a stock market rebound form the basis of the contrarian play.
The underlying principle is that volatility, by its nature, exhibits mean reversion. Extreme deviations, such as a significantly elevated spot VIX relative to longer-term measures, are often unsustainable. The expectation is that volatility will normalize, paving the way for market stabilization or a resurgence.
However, a critical caveat remains. The backwardated curve is not a panacea. It can reflect genuine, persistent risks. Major unforeseen events can sustain or even amplify the inversion. Therefore, a contrarian stance is inherently risky.
Yet, for those who believe in the market's tendency to overreact, the inverted volatility curve transcends a mere threat. It becomes an opportunity, a moment where the market's fear, though palpable, may be fleeting, paving the way for potential gains. This thesis invites a nuanced perspective, urging traders to discern between transient panic and enduring risk and to recognize the potential for opportunity within perceived chaos.
SPX isn't tracking the VIX. Bullish?It seems there are a dozen technical reasons to expect a Bear Market in U.S. Stocks in 2025, but the VIX isn't one of them. At least not right now. Not sure what that is, but it may be because option prices are dropping now that the tariff scare is basically over. This chart comparing SPX with 1-VIX lays out the case.
Reading the VIX right nowUsually when the VIX (candlesticks) retraces, and closes, 50% lower from a rapid swing high, it is often provides a pretty well-timed entry for a bullish trade on SPX (black line shown in chart).
But this time around I'm cautious. The gradual build up and gradual decline seems to indicate something stronger is at play, something the market can't shrug off. This week might give clues since no market-shaking news is scheduled until Friday's PCE number.
Go Long on VIX Amid Elevated Market VolatilityKey Insights: The current market scenario is characterized by significant
volatility due to geopolitical tensions and economic uncertainties, making
the VIX an essential indicator for investors. With the VIX priced at 21.77,
close attention should be paid to support and resistance levels, as a breach
could provide actionable trading signals. Maintaining a long position on the
VIX could be advantageous amidst ongoing market instability and the
potential for further fluctuations.
- Price Targets: For those considering a long position, the following targets
and stops are recommended next week:
- Target 1 (T1): 22.60
- Target 2 (T2): 23.50
- Stop Level 1 (S1): 21.20
- Stop Level 2 (S2): 20.60
- Recent Performance: The VIX has experienced heightened activity recently,
reflecting the market's sensitivity to various risk factors, including
geopolitical issues and tech market fluctuations. The current level near
21.77 points towards a phase where volatility remains above average,
suggesting ongoing investor concern.
- Expert Analysis: Market experts suggest maintaining vigilance in the face of
potential volatility spikes. The consensus indicates that despite recent
fluctuations, there is cautious optimism for relief rallies. Taking a
strategic and disciplined approach amid the current market conditions is
suggested, focusing on long-term quality assets while using the VIX as a
barometer for short-term volatility.
- News Impact: The pending FOMC meeting stands as a significant event that could
influence market volatility levels. Geopolitical developments and economic
data releases, such as retail sales, are also set to impact market dynamics.
Notably, volatility in tech stocks and companies like Tesla demonstrates
market sensitivity to external events, highlighting the importance of the
VIX as an indicator under current market conditions.
Long S&P 500 Three signals have been hit:
1. The equity put call ratio has reached a value of 0.94 this week, further indicating a potential bottom in sentiment.
2. The Vix has spiked above 30 and is beginning to stabilize below 25.
3. The front month and three month Vix futures backwardation has stabilized.
This Friday, AMEX:VOO recorded a 2% gain. Therefore a long can be taken on Monday close with a stop loss placed below the Friday low.
VIX and The BUY SIGNAL for The SP 500 is being Given The chart posted is the VIX index > we are now outside the bands and we could see a minor new low in the sp if the wave structure is the alt . This would give us a supper bullish signal one that would huge . I took minor gains and will re position if I can get that last move to trap the shorts have great weekend I am looking for 3 up weeks in a row
VIX PARABOLIC means MAJOR DROP, we are on that zone now.
After VIX's massive breakout this past few weeks -- rendering the market helpless bringing forth a bleeding season, VIX is bound for a major drop after tapping a strong resistance level.
That parabolic move should warrant a weighty trim down ahead in the next few weeks.
Expect markets across the board, from equities/crypto/fx majors/gold to bounce big from here on.
Ideal opportunity to enter here relative to your preferred asset to trade.
Spotted at 27.85
Interim target 20.0
Mid Target 15.0
VIX & Seasonality shift S&P 500Based on seasonal data mid to late March marks a positive shift for the S&P 500.
VIX has held above current trend to aid the latest correction on the S&P 500.
A clear break below the trend line on the VIX could offer a significant opportunity for a counter trend rally before markets continue downwards.
Direct relationship between JAP 10 year yield and VIX?With reference to my previous posts on the inverse relationship between the VIX and USBTC, I want to give another instrumental relationship to monitor the trend of VIX in order to get some clues on the inverse trend of USBTC through that.
The 10 year Japanese Gov. yield is in direct relationship to the VIX, though not too detailed but in line with its trends and major movements. As long we can expect the 10yJAP to increase - as it can be predicted right now due to rising inflation in Japan - we can expect the VIX as well to be elevated or rising. A break of the 10yJAP trend can be indicative of a change in the trend of the VIX and USBTC as well.
Harmonic Potentials On SPY & VIX Signal Huge ReversalUsing a harmonic pattern detection script developed by reees alongside RSI with a 15 minute timeframe, we see that AMEX:SPY has a huge upside potential to ~$588 while the TVC:VIX is showing that it has a high chance to sell off. With the RSI break above its moving average for AMEX:SPY and below the moving average for TVC:VIX , the patterns potential completion is strengthened. Usually, based on historical data, when both these instruments show an anti-symmetric pattern potential, it typically has a high chance of succeeding and reaching the potential price zone.
