VIX Apocalypse

2020年10月26日

VIX: VIX term structure suggests elevated volatility in the coming weeks/months. Welcome to backwardation. This is usually a good time to own UVXY since the carry is low & actually compensates you for owning volatility. The only issue is that spot VIX needs to rise and SPX needs to sell. Then UVXY will have an asymmetric payout. However, for now, without SPX declining we're just waiting around at this point with slightly positive carry. If SPX rallies now with backwardation occurring UVXY loses big time. The opposite will occur if SPX declines.

Overall, a big move in either direction is incoming.

No point in trying to predict where this will land. I'm waiting for a breakout for an indication of where/how I will position.

Let price action decide.

#STUDY

Cheers

2020年10月26日

交易進行

VIX is breaking out to the upside. I need to see a follow-through to increase my UVXY position.

2020年10月28日

註釋

VIX decided two days ago when it closed above the wedge. I want to empathize the prudence of patience.

My Twitter link is in my bio (it's also my username). Most of my updates will be there.

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