There seems to something brewing in the markets. There was a quick sell-off and sudden surge in volatility in VIX, VXO and RVX. Hamzei is indicating that a probable correction is on its way. Bill has written couple of interesting articles on VIX that you don’t wanna miss. On the other hand Kevin seems to have a contrarian point of view and has presented an interesting observation about Dow.
Other thing worth noticing is unusually high volume in VIX yesterday. Check out the March quarterly 18 call options for VIX futures. It was 20,503 contracts. For reference, in March Qtrly 13, or 15 is only 2044 and 1990. Seems traders are expecting rise in volatility especially on S&P500. On the other hand gold has been trending-up in the past few weeks. Check out Jim’s take on this as well. So stocks rise in volatility and gold trending-up? Oil is up? What does it say to you?
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People have been trying to call tops over the duration of this entire rally since Jun 06 citing a variety of reasons. One cant make anything out of “seemingly unusual activity” unless he knows the full picture of what’s going on.
Its best to trade what we see and not what we think. Mr.Market is far smarter than any of us here and its better not to predict what we think should happen.
Now that I’ve said this, the market may reverse
You said it and at least RUT heard you
My timing couldn’t have been better…