A Tale of Volmageddon

Revisiting Volmageddon 1.0 - Preparing for Vomageddon 2.0

Volmageddon; a blending of the words volatility and Armageddon, refers to the extraordinary U.S. stock market activity that took place on February 5, 2018.

On February 5, 2018 the Cboe Volatility Index (VIX) increased from an opening value of 18.44 to 37.32 at close, after about a year of low stock market price volatility.^[1] The stock market, along with price indexes tied to its performance, rallied strongly throughout January 2018 after having mostly risen for the previous few years. Market volatility as measured by the VIX had been mostly subdued. But in early February, market sentiment turned negative and the stock market sold off substantially on February 2, a Friday.^[2] On Monday, the stock market continued its plunge and the VIX began to rise, more than doubling from open to close.
The tale of Volmageddon is really the story about what happened to the short-sellers of volatility on February 5, 2018
continued... @ marketswiki.com

Revisiting Volmageddon 1.0

I remember the Volmageddon incident of 2018, very well, and after following the market closely - for most of my adult life - I recognize when the VIX is - once again - being routinely shorted, by the marrilly, complacent, manipulators. More about the setup for Volmageddon 2.0 in a moment.

My FXStreet Interview Dated April 10th, 2018

If you recall, before anyone had labelled the great $VIX short squeeze of 2018, "Volmageddon", it was a hot topic of conversation, in my first interview with Dale Pinkard, at the FXStreet.com

Sidebar:
Whether you're new to this (trading), or a seasoned veteran, I suggest you tune into Dale's show, and I promise you'll learn a thing or 2..! It's even FREE, and I receive no kick back for the recommendation. I tuned in recently, and I was reminded to think outside the box... (a story for another day), and we all need to be reminded sometimes!

This is the interview in which Dale, and I discuss the great $VIX short squeeze of 2018 - aka Volmageddon 1.0.

Cue The Video

I've cued up the Video (below) - to 11:30 -, so you can listen to my explanation for Volmageddon 2018, and view what I was seeing in the charts, for yourself.

The Segment is only a few minutes long: Be sure to see what happened to the $SVXY (leveraged $VIX bear (short) ETF) - because today, we're seeing the same situation develop again, in the same fund - the segment ends around 14:20 (after we both have a good laugh).

At the time of the interview I was under the impression that the SVXY was going to be retired, but I was probably only repeating some fake news, that I was hearing at the time.

In hindsight, nobody should be surprised that this fund still exist, since it's instrumental in helping the powers that be, drive the $VIX lower. Even the Fed bragged about lower volatility - with a wink and a nod - after they took control of the market in 2008. Think the Federal Reserve isn't in on it (selling volatility)? I'll leave that for you to decide!

Volmageddon 2.0?

$SVXY - this fund still exists, and continues to be used in order to help manipulate the $VIX, and I don't believe the criminal cartel -who controls Wall Street - is finished with their $VIX manipulation scheme. Not by a long shot!

As I alerted to on Friday....

I can tell you this; if the $VIX continues to break higher, the bulls are in trouble. #OPEX #Friday

— Veteran Market Timer (@3Xtraders) February 17, 2023

And it was at that point the $VIX was driven lower - again no coincidence! No more a coincidence than the $VIX being shorted at the magic number - 20 - on Thursday.

Today's $SVXY

I have a target for the $VIX, but you won't find it on the above monthly $SVXY view - above

Sure the pink line is a stophunt, but even if that breaks, we aren't going to see the same kind of unwind we saw in 2018.

If we ever get to the point where we see Volmageddon 2.0, I'm sure it will catch most traders/investors off guard, just as the last one did.

Still Seeing A Lot Of Complacency In This Market

Friday - the idiots on CNBC Fast Money were seen once again throwing caution to the wind, talking about how the market doesn't want to sell off, while ignoring the fact that the only thing holding it up, may have been, February, Options, Expiration (OPEX)!

I'll keep sounding the alarm, especially after seeing the $VIX action of the past few days. It has been nothing short of a wild ride.

Recently I even went so far as to advise investors/ traders to "reduce your risk"...in my Feb 7th update, because something just doesn't smell right, and the market doesn't react normally.

I've been warning of a sharp correction, for some time now, and even more so as Wall Street becomes utterly complacent...

... yet this story continues to play out as it did even as the warning - of Volmageddon 2.0 - was sounded last week - by JPM - as I pointed out in Friday's blog -

Some folks are calling for the $VIX to hit 50, before May? I don't see that as even a remote possibility.

IX index could stage a 175% comeback to $50 by May - 50 Cent investorsobserver.com

I see a near 0 (zero) possibility of seeing anything close to $VIX 50, by May. #CNBC is a clown show
— Veteran Market Timer (@3Xtraders) February 17, 2023

Good luck,

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Saturday, February 18, 2023