The setup for this is for VIX to spike up 5 points.
Once VIX spikes up 5 points and then falls back down by 75%, the storm has passed and the BUYERS who stepped in a those levels can be viewed as BIG MONEY or SMART MONEY since they were buying low in a mini-crisis.
After VIX comes back down, the storm has passed, but the buyers eventually get TESTED to make sure they are real or that they are BIG.
It's happened this way for a long time. A year ago I posted this, but I don't keep posting every follow up signal. The one I did post suggested that the SPY needed to drop back down to 194 to retest those buyers, but we still haven't done that.
We have had five more signals and they all worked very nicely and the current one is still setting up since VIX hasn't fallen back down 75% from the recent spike up. VIX must hit 14 and when it does, that's the level that needs to get retested.
Maybe this doesn't look like rocket science, but it is another way to look at VIX and the buyers who buy when VIX is HIGH and how the market retests those buyers in the future. The market is always trying to see who is in control. The concept is basically that "When VIX DROPS off of a spike, those buyers will get tested".
If that isn't clear, it will be at a later date when I post again on this topic.
Cheers,
Tim 3:46PM EST Monday, July 13, 2015
评论
penny_b_reaker
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Very cool tip. Love your analysis ... keep up the good work!