Saturday, August 22, 2015

VDX Updates +......08.22.15

With the VIX popping 25% on Thursday and then 46% on Friday its now at long term resistance levels.  That should serve as some sort of comfort to battered bulls but in reality we could see a couple more legs up in the VIX before that beloved hairy bottom pattern appears.
Now we have to be concerned about opening rallies that turn into Trap Door setups and the misery and loss of capital that ensues.
Hey!....I'm normally a pretty upbeat guy but this is serious stuff.... and.....just to add to the worry beads...September....just 10 days away.... it typically the weakest month of the year.
So what do we do?   Cash is king right now.  There was a little afterhours pop in most issues on Friday but we talked about this before....the big prop shops love to goose a falling market into the close just so they can sell it down hard the next we have to be wary of false reversals.
Here's a look at 4 VDX charts...SPY, FXI (China), FXE (Euro) and UUP( US dollar).Aggressive traders may want to focus on the FXE/UUP pair either as ETFs or in a Forex context if you trade currencies.  China has been slammed again and again and again but the bad news is I don't think we seen a bottom there yet.