It’s been a lousy environment for trading the last 5-6 weeks. Although SPX closed Friday exactly where our Jan 27 (Day 141) target was set, there have been very few dips since early December that provided in much in the way of trading opportunities — unless you enjoy mindless, intraday dip-buying.
Those who trade after-hours have had things a little better. But, even the eminis chart shows that a long series of CL- and VIX-driven prop jobs dating back to Dec 9 have kept ES bouncing around in a very narrow range [see: VIX – Just Another Tool.]
Friday was more of the same, as the initial gap higher was driven entirely by a nonsensical spike in CL (which quickly faded as soon as the inaugural address began) and was saved from a negative close by VIX being slammed by over 6% in the final hour.
It’s obviously very difficult to get much downside going if all it takes to prevent it is some 23-year old MIT grad, sitting in a windowless room somewhere, mashing on the SHORT VIX button over and over again until prices stabilize.
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