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SPX Update
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SPX Update

by MoleJune 22, 2011

A quick update on the SPX – in particular as the FOMC news did not produce a quick spike:
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Charts and commentary below for anyone donning a secret decoder ring. If you are interested in becoming a Gold member then don’t waste time and sign up here. And if you are a Zero subscriber it includes access to all Gold posts, so you actually get double the bang for your buck.
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If you were long since last Friday now is a good time to take profits and to wait for a little drop. All in all it seems to me that we may be pushing toward 1320 before we see more meaningful downside. But I would not be surprised if we first saw a little shake out. And if we close on a doji today then the odds for a quick drop would increase.

So my take is this – best to take profits now and wait for a little drop lower to go long again. If you are a Zero sub also take a look at the Zero Lite – which seems to be supporting my view that we are due for a quick reversal. Always remember – in thin summer tape like this you can only rely on very clear odds – and right now the whole thing looks a bit iffy to me.

Cheers,

Mole
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About The Author
Mole
Mole created Evil Speculator amidst the chaos of the financial crisis in early August of 2008. His vision for Evil Speculator is a refuge of reason, hands-on trading knowledge, and inspiration for traders of all ages and stripes. You can follow him and his nefarious schemes at various social media waterholes below.
  • Anonymous

    Way ahead of you, thanks your confirmation of what MY interpretation of the Zeroes have been telling me today.  THANKS for keeping the subs posted.

  • TwinTurboRX7

    I think the website is having issues…

  • raised_by_wolves

    What part of the site? Just the comment section?

  • http://evilspeculator.com molecool

    Please elaborate so I can pass it on.

  • TwinTurboRX7

    browser does not load evilspeculator website at all, either these posts, or zeros.
    Timing is about when I receive the email from Mole about the new post 5-10 minutes ago. Now it loads fine.

  • Anonymous

    Thanks, I just added the 100BB to my settings.

    I see the VIX is down another 4% with 35 Minutes to go.  Let’s see how we close.          

  • http://evilspeculator.com molecool

    Not sure what’s going on lately – it seems a bit more stable than a few days ago. They recompiled Apache which seemingly fixed the intermittent outages. Can anyone confirm any trouble accessing the site today?

  • Anonymous

    By quick drop I take it you mean the downside shakeout (prior to a run to 1320) could happen soon (today-tomorrow) as opposed to quick drop the highs are already in and it meaningfully drops before 1320. Put another way: is the “doji/quick drop” consistent with the “little drop” scenario or does it invalidate it?

  • Anonymous

    Dollar moving up nicely, nearing some resistance right now (on hourly)

  • tradingmom

    Mole, when you can, would you please extend the green trendline on the daily zero?  Curious to see what happens when it hits the zero mark/signal line.

  • Anonymous

    Yeah….. what she said   I like lines too

  • tradingmom

    I like breaking through them.

  • Anonymous

    having the same issue past few days

  • Anonymous

    OR, bouncing off them…

  • Anonymous

     i have a hunch banks are going to sell their treasuries in order to buy equities which will boost their capital…

  • nyse
  • http://evilspeculator.com molecool

    See guys – I told ya 😉

  • nyse

    Think youre right…
    http://screencast.com/t/tdkY4tgHgCE
    (damn. couldnt get it post before it broke it)

    p.s. what does this mean on the zero?

  • http://evilspeculator.com molecool

    No, we want to see a drop through first.

  • Anonymous

    Internals broke down at 3:20 PM and never looked back.

    OK.  I have to admit to my ignorance when it comes to the VIX.  Would someone explain to me what would cause the VIX to go Down on a Down day.  Was it simply that more calls were bought then puts?  Was it the MM’s having their way with Vega?  Is it that other than absolute Buy or Sell Signals that the VIX as a day to day indicator means nothing?

    Or is it some combination of all of the above?  

    I would appreciate any and all input on this.

  • raised_by_wolves

    Did you mean to say, “what would cause the VIX to go [DOWN] on an [SPX] down day”?

  • Anonymous

    Yes.  Sorry , I just fixed it.  

  • volar

    oooh do you want me to run the math of VIX lower and SPX higher and the probability of the market being higher or lower next week?

    I love that one 😉

    Consider it done

    BUT bobby the VIX is consistantly the LOWEST in the month of JULY. To wit:

    http://content.screencast.com/users/wprosser/folders/Jing/media/4e660fe9-bb59-4d6d-b52a-95bdb752e18d/2011-06-22_1415.png

  • nyse

    I would. That would be great.

  • Anonymous

    someone correct me if i am wrong, but i think VIX is calculated from the number of ATM puts bought.

  • Anonymous

    Thanks.   I would appreciate any and all explanations.  🙂

  • volar

    I will run the math, for the trade probability in a minute.

    BUT the VIX is lower bc MMs are not going to bet on the VIX rising into the 4th- they would be an idiot for doing so given the historical data. No reason to focus on it going lower unit after the 4th if you ask me

    http://content.screencast.com/users/wprosser/folders/Jing/media/98208a19-e388-4ba8-adcd-6fdc8bd6b2f1/2011-06-22_1422.png

  • http://pulse.yahoo.com/_S4G4E3FFJYUJSPL4TM2JWMSCDQ John

    Mole,

    a stupid question: what does T1 and T2 on your chart stand for? is these target lvls where to take profit? thanks,

  • Anonymous

    Wow!  That’s amazing.  We are just about at the money of both the Average and the Median VIX for this time of the year.   

    Must be a coincidence.   LOL

    What a game.  What a game.  🙂

  • Anonymous

    “The … VIX is based on the S&P 500 Index,… and estimates expected volatility by 

    averaging the weighted prices of SPX puts and calls over a wide range of strike prices.”http://www.cboe.com/micro/VIX/vixwhite.pdf

  • Anonymous

    Flat and looking for love. Lost 3 handles on the NQ on the false breakout @ 12:06 pst. Tried to get short, but never really got a good signal to do so.

  • Anonymous

    Flat and looking for love. Lost 3 handles on the NQ on the false breakout @ 12:06 pst. Tried to get short, but never really got a good signal to do so.

  • Anonymous

    yes

  • Anonymous

    yes

  • Anonymous

    Thanks for the excellent update. I sold my SSO puts at close that I bought around 1,296 today. Banked some small coins, got nervous to hold overnight as I think we’ll move higher. So now I’m 100% sidelines, ready to follow the tape. Lost my mojo for a few weeks there but seem to getting it back. Any thoughts on what I should do when I loose the mojo? Sideline and paper trade? Trade with less money? Drink Guinness? 😉

  • Anonymous

    Thanks for the excellent update. I sold my SSO puts at close that I bought around 1,296 today. Banked some small coins, got nervous to hold overnight as I think we’ll move higher. So now I’m 100% sidelines, ready to follow the tape. Lost my mojo for a few weeks there but seem to getting it back. Any thoughts on what I should do when I loose the mojo? Sideline and paper trade? Trade with less money? Drink Guinness? 😉

  • Anonymous

    Hi Volar,
     
    Any ideas on how much the Oct/Nov 2008 VIX spike to 80 skews the Historical 5 Day VIX chart or is it ignored as an outlier?

  • Anonymous

    Hi Volar,
     
    Any ideas on how much the Oct/Nov 2008 VIX spike to 80 skews the Historical 5 Day VIX chart or is it ignored as an outlier?

  • volar

    NEW POST

    And if you like to make coin,

    NEW POST FOR RATS ONLY !

  • volar

    NEW POST

    And if you like to make coin,

    NEW POST FOR RATS ONLY !

  • Anonymous

    Go cash,until the odds are on your side                                                                      

  • Anonymous

    Go cash,until the odds are on your side                                                                      

  • Anonymous

    Just some thoughts on possible retracement targets for this up move.
    http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=0&dy=5&id=p17493478025&a=226823824

  • Anonymous

    Just some thoughts on possible retracement targets for this up move.
    http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=0&dy=5&id=p17493478025&a=226823824

  • Anonymous

    Thanks.

    Sidelines is the hardest position I think. Need to work on my patience, just
    sit as Livermore said. I bought SSO around 1,266 yesterday so I’m looking at
    three for three profitable trades this week. Mojo back in time for weekend.
    🙂