UPDATED ANALYSIS on VIX and CURRENT MARKET
Dear followers and Copiers,
I share with you this short VIX analysis and I want to invite you to not panic and instead if you have the resources to prepare to take advantage of this typical situation of mixed panic and technical seasonality conjoining.
ON THE EMOTIONAL SIDE
The Market is worried about higher for longer inflation due to higher oil prices due to the Iranian war and the higher expenses that the USA government will have to sustain for this conflict.
The consequence of this is bonds going down, and in the initial phase everything is liquidated, good assets and bad assets.
Gold, Silver, bond, high quality stocks (that we have in our Portfolio), banks, low quality stocks, AI, Crypto… everything is liquidated at the same time to create liquidity to reinvest in the second part of this short-term cycle.
When the media begin to talk about recession, and make you fearful is typically the time, you want to get into the markets.
ON THE TECHNICAL SIDE
The Vix has been growing its baseline since mid-December, probably due to rebalancing of the AI trade, plus the FED meeting and the consequences of the Iranian war didn’t change much of this movement it only made it more violent than it would have otherwise been.
In addition, tomorrow is a TRIPLE WITCHING DAY, a day when a very large amount of options and futures are due to expire, often it marks a peak of a movement and soon afterwards the beginning of a new one.
Below you can see that the VIX movement is still in place and as I mentioned in the previous updates, to break the upward trend, we need to see the Vx breaking consistently below the trend line.
The trendline is currently around 19-20 of the Vix, it looks like we are close to the completion of this very large capital rotation.
Remember: Be Fearful when the others are greedy and Be greedy when the others are Fearful!
Daniele
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Not investment advice. The author may have financial interests in the mentioned instruments.
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