Update on VIX: Mar 10, 2020

It’s been a while since we took a big picture look at VIX. Since it reached levels not seen since the GFC yesterday, this seemed like as good a time as any. VIX is an interesting instrument. Once a reliable measure of volatility in the market, it was used by many to hedge risk.  As … continue reading →

The Storm Finally Arrives

After weeks of gathering clouds, the storm we’ve been watching has finally arrived. S&P futures are lock limit down just a few points above our next downside target. Not surprisingly, all of our other targets across currencies, commodities and fixed income have either tagged or exceeded our next downside targets, with more to go once … continue reading →

Burning Down the House

Once upon a time, a few boys whose families owned the biggest lemon groves in town got together and opened up a lemonade stand. It was a very hot summer, so they sold an enormous amount of ice-cold lemonade. Since they controlled the supply of lemons, they were able to quickly raise prices from 10 … continue reading →

Same As It Ever Was?

You may wake up and see futures down 60 points only to find they’re bouncing off the bottom of a rising channel and backtesting the (now) support of the 200-DMA. You may find that VIX remains very much under control even though a global pandemic that central banks can’t “fix” is ramping up. You may … continue reading →

Coronavirus – Why the Complacency?

I’ve done some calculations on the spread of the coronavirus in Italy, which has presumably learned a thing or two from China’s experience but suggests a path for other countries just now coming to terms with their own exposure. Granted, Italy’s quarantine and aggressive treatment might put a dent in the exponential rate at which … continue reading →

What, Me Worry?

The rescue operation we detailed on Monday [see: Rescue Operation Underway] is taking another stab at the 200-DMA this morning after the Fed’s ill-advised emergency rate cut nearly unraveled the progress the algos had already made. Again, it’s a battle between the algos and fundamentals with numerous factors lining up to nudge stocks past important … continue reading →