Market Update 3/13/2020 - Friday The 13th - Charts FUBAR

I haven't had time to do and update, for a while, for obvious reasons. Global markets have been crashing for several weeks   several support levels were taken out over the past 2-3 weeks. This destroyed the upturned bullish channel we've been relying on for the past 12 years, and I continue to delete hundreds of broken charts. To make things even more difficult, I accidentally changed the timeline settings on more than 1 of my long term chart folders, and this left many charts FUBAR!

This morning we're seeing a sentiment change. It could be that the, "powers that be", figure they better dress the windows ahead of the end of the first quarter, to avoid massive redemption's in April, and what better time for a short squeeze than a week before options expiration. There's all the catalyst - for a rally - you need. Don't try to ague with yourself that markets can't rally, on bad news, they do this all the time.

Reminder: Money, and sentiment, moves markets, not bearish tweets. It's time to put the negativity out of your mind.

Now that everyone is bearish, and a massive number of retail investors/ traders are short this market, it's time for a short squeeze, that I think could easily carry us into July.

This is the fastest downside velocity - in a 3 week period - coming off an all time high, in market history. This isn't normal. It may have been planned for a very long time, and the pandemic is being used as an excuse to take down global markets, which were already weak, but for every over-reaction, is an equal and opposite reaction. 

The Economic collapse is being priced into US equities:  

The US the consumer was supposed to carry the economy. Well, now the consumer is cancelling everything, and wondering if they'll have a job next month, and one top of all that, Russia is trying to destroy the US Fracking industry, by continuing their so called "oil war". That story is old; but the coronavirus story was just one more reason for the market to over-react.

Oil:

See where this "Oil Price War", story originated: Moscow

Origin of the "#Oil price war" story, with a 29.50 target. https://t.co/ZyddWiXBRy

— Veteran Market Timer (@3Xtraders) March 9, 2020

In case you think I'm taking the coronavirus lightly: 

I predicted only a few months ago, that a black swan would emerge, which may cancel the elections, and lead to massive civil unrest.

See: Coronavirus much much worse than Ebola 




It's not that Ebola is that deadly, but it spreads rapidly, and that means that it will overload the healthcare system. 20% of infected people end up in the hospital, and there just aren't enough hospital beds.

As we've already seeing in China, and Italy, we will probably, see several large cities in the US, including my home town, Chicago, locked down. This will lead to a panic, and empty store shelves, as we've already seen some hoarding.

I refuse to fight crowds at the grocery store during a panic, and if need be, I can last several months, on what I already have. I've been preparing for this moment for a long time, but once the news cycle changes, and store shelves are replenished, I'd like to make some final preparations.

Imagine being locked in your house for several months, without work. are you well prepared?

Coronavirus is going to be with us for a while, but as long as markets remain open, and the volatility remains high it should offer some excellent trading opportunities.

$SPX

I'm seeing a megaphone pattern, with a 3100 target on the $SPX, by July. This a pattern 99% of technicians aren't familiar with. Most are still looking for a bullish channel, which is utterly ridiculous. 

Another possibility is a much bigger crash around the Summer break.

If these charts break, then I'll be back to square one.

I'll be updating the charts in the public charts area shortly, and because volatility is so high, only daily candlestick charts, or longer time-frame.

Follow my twitter page for real time market alerts, and watch me block the fools who dare pester me in the morning, talk up their own book, and otherwise troll me. I don't mind questions, but I'm not on twitter to hold new traders hands, and teach common sense. Read the Twitter warning in the chart legend (tab).   

Thanks for your support
AA

Trading the $VIX

This blog on trading the $VIX was most recently updated [9/17/2022]

Trading the $VIX

A better title for this blog may have been, "Guide to using the $VIX", because I don't recommend actually trading it, but rather using it as a guide, to help keep you stay on the right side of the trade. 

The $VIX is our #1 fear indicator. High $VIX = fear. Low $VIX = no fear (in the market). Pretty simple.

An oversold ($VIX) can be seen as complacency, and greed, which is bearish, and raises red flags to experienced traders, but usually a low $VIX only means that there's little fear in the market, and this is a good thing.

Exceptions: There are times when the market can continue to rally, despite a gentle rise in volatility (which is what the $VIX technically measures), but that's rare. 99% of the time, the $VIX is going to trade opposite the broader market.

A $VIX that breaks out above resistance, and continues to pop higher, always points to a risk off environment, and a rising $VIX should never be ignored. In fact it deserves a place in your tickers, and perhaps even a devoted chart view or 2, during times of high volatility. I personally have probably 100 $VIX charts, including leveraged ETF which trade with, or against the $VIX.    

Charting the $VIX take some practice, and I can honestly say, after many years, I am the foremost authority on reading the $VIX. Today, in 2022, you see every traders trying to do, what I started doing nearly a decade ago, and the experience shows.  

The $VIX is a sentiment indicator, and once it peaks out - in a market crash - it tends to reverse violently. Leveraged (VIX) ETFs, in a major sentiment reversal, may give back as much as 50% in a day!

Charting The $VIX 

 The best advice I can give you, on charting the $VIX, is to use trend lines, and watch certain universally accepted resistance levels like $VIX 20. A $VIX of 20 is considered high, and keeps investors on edge, and in a defensive mode. 

At the time of the most recent update to this guide (2022, the $VIX continues to trade above 20, nearly 2 years after the covid scare. This is unheard of!   

Without the $VIX it would be near impossible to determine market sentiment in real time, and if there's one thing I've learned over the past few years it's that what is important above all else is consistency, on a daily basis. 

The $VIX is technically a measure of market volatility, and volatility works both ways. At $VIX 10 the market hardly moves, while at $VIX 90 the market may swing 10%, or more, in only a few hours.

There are various ways to trade the $VIX, but I don't actually recommend trading the $VIX, and you can see what happened to traders, who were using the leveraged inverse fund to short the $VIX in early 2018, as the manipulators were wiped out in 1 day, as I explained in my live interview on F.A.C.E.






Sorry, I have to cut this article short, but I want to leave something for the book, I have planned.

Good luck, 

AA

Launch 3XTraders 2.0

Welcome back Traders,

It's time to dust-off this blog, and get y'all up to speed, and there's no better time than now!

There just hasn't been much to get excited about - marketwise - until now, but there are a couple more good reasons for my hiatus:

For those who don't know it, I used to have a private membership website, with a few loyal members, but it turned out to be more distraction than it was worth, and charging folks even a small fee to trade into a market bubble just wouldn't be right.

Closing the website was one of the best decisions I have ever made. because it has allowed me to hone my skills, with few distractions.

I also relocated a little over a year ago, and moving is disruptive, and it has taken some time to settle in and get adjusted. After I moved I attempted to re-launch this blog, but I found I was better off tweeting, and charting.

Twitter is the best place to exchange up to the minute information, and even blow off steam, when there's nothing better to do. If you don't have twitter; create an account, and follow my twitter [link] for the most up-to-date information. There are going to be times when we need to get more in-depth, and that's what this place is for. I'll direct you here, when I feel the need, and have the time, to blog, otherwise you can find me tracking the market in real time, on Twitter. Market forecasts often change in real time!

Feel free to ask questions here, rather than on Twitter, because distractions aren't helpful. There are times I look at opposing views, but usually it's only as a contrarian indicator. For that reason I seldom check twitter notifications during the trading day, and have been known to block people in the past. I understand, there are times, when it's hard separate your emotions from the trade, and I'm not always going to be right, but lots of opposing views are a distraction. 

In future blogs I plan to show you some of the most important market indicators, and techniques, I look at, to predict market movements, some of which - like the $VIX (our fear indicator) - you should be watching in real time, so you understand what I'm looking at, or why or I hold a certain market view.

More to follow,

Anthony Allyn

President Opaque AKA Barry Soetoro Denies Charity of Choice $5,000,000.00

Another accurate prediction; for the record:

Let me take a stab at what Trump has dug up on the great one. Obama School Records will show he was a "foreign exchange student".
— Anthony Allyn (@3Xtraders) October 23, 2012

Next Day:

You have all been waiting-- the response has been amazing! Watch my announcement now, press release to follow at 12:15. bitly.com/SivjCv
— Donald J. Trump (@realDonaldTrump) October 24, 2012

Whether you like him or not, Trump knows something is rotten in Denmark! Obama isn't who he claims to be.

Why would President Obama refuse to release his college records, and his passport? It's a simple thing to do, and $5,000,000.00 is a lot of money, which would go to help countless people in need.

I'm sure Obama and his fellow Liberals would like nothing more than for Trump to be humiliated, and what better way to do it than to take $5,000,000,000.00 of his hard earned money. Whatever they're hiding must be far more valuable than money.

 No doubt the truth will eventually come out, but this is how we can expect it to play out.

1. First they will attack the messenger just as Trump is already being attacked. Just as they attacked Romney, while our embassy was allowed to be over-run by terrorists.

2. Then Obama's handlers, his backers, and a majority of the Democratic party will lie for him in order to try to cover up the truth, just as you see them doing today on BenghaziGate, and Fast & Furious.

 3. Then they will downplay whatever the ugly truth is. What difference does it make if Obama is a Muslim, who cares if he lied about where he came from, or even if he is a US citizen or not. All that matters is that Obama gives a thrill up my leg.