Yesterday started out with a VIX-driven pop that quickly fizzled and nailed our downside target before rebounding and hitting our upside target. Since SPX closed right at resistance, it needed a boost overnight. So, why not go back to the same clever trick that worked the day before? Yes, VIX’s red channel has broken down … continue reading →
Tag Archives: derivatives
As noted back on Feb 21, the EURUSD has broken down from its rising channel (white) and accelerated to the downside, breaking the Jan 4 1.2996 low and the psychologically important 1.30 level. The intersection of the purple .618 and two white channels at 1.38 will have to wait (till my next visit across the … continue reading →
Alice laughed: “There’s no use trying,” she said; “one can’t believe impossible things.” “I daresay you haven’t had much practice,” said the Queen. “When I was younger, I always did it for half an hour a day. Why, sometimes I’ve believed as many as six impossible things before breakfast.” ― Lewis Carroll, Alice’s Adventures … continue reading →
UPDATE: EOD SPX went straight to our 1338 target and hung around pretty much all day — closing right on the H&S neckline. The analog I first posted on Mar 9 is still very much on track. It called for the low 1300s by May 16 — which looks doable if we have another day … continue reading →
I can picture it clearly: It’s 1963 and 10-year old Benny Bernanke sits staring at the black & white Zenith in the living room of his East Jefferson Street house, captivated by the voice of Vic Perrin… “There is nothing wrong with your television set. Do not attempt to adjust the picture. We are controlling … continue reading →
I’ve been harping on the incredible threat represented by the $250 trillion in almost entirely off-the-books, unregulated derivatives market — 95% of which is should be but isn’t on the books of the top five US banks [see: The Wipeout Ratio.] It’s an astonishing 550 times the tier 1 capital on the books of these … continue reading →
A simple calculation comparing major banks’ derivatives positions to their assets and capital shows how little it would take to wipe out either. The first ratio is the multiple that derivatives represent of Tier 1 capital. The second shows the miniscule percentage decline in the value of derivatives portfolio it would take to completely wipe … continue reading →