VIX pitchfork pattern analysis

23 ก.ย. 2020

The price will likely go up towards the point where 3 pitchfork lines almost intersect (see the blue arrow). However the latest pitchfork only covers a limited numbers of bars (4 bars from the low point where the pitchfork starts, Sep. 14, and the high point, Sep. 21) and thus it's rather narrow. It is possible that the price action will move outside and thus expand the pitchfork. This, of course, will change the expected endpoint but even as is, it may give an idea about where VIX is heading.

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24 ก.ย. 2020

บันทึก

I said "The price will likely go up", sorry, that was a typo, I meant "go down" as the arrow points (since I'm short on VIX and bullish on SPY).

24 ก.ย. 2020

บันทึก

Also, as I said in my initial post: "It is possible that the price action will move outside and thus expand the pitchfork." That indeed happened (the channel was too narrow to remain as is), the price went up above the pitchfork channel and thus expanded it which moved the end point of the arrow to the right.

27 ก.ย. 2020

บันทึก

There is a good chance that the price will go up (and the market down) on Monday before resuming the downpward move. Here's why I think so. I wrote an algo/strategy that gives excellent results for TECL (a leveraged 3x bull tech sector ETF). The version optimized for TECL gives 677,000% profit since 2012 in backtesting. The version optimized for SPY (and used unchanged on TECL) has about 50,000% profit (tradingview.com/chart/TECL/QOYZiqCw-TECL-ToW-Srategy-Bullish-Signal/) and this year over 90% profitable trades. Because it's so accurate it's a good gauge for the market. On Thursday at close the algo gave a bearish signal. Rather often a predicted fall follows the bearish signal one day late. For example, in forward testing the algo predicted the current fall on Sep. 1 but Sep. 2 the market went up and only on Sep. 3 the big fall happened (you can see that in the link here). Similarly, one version of the algo also gives a bearish signal on Sep. 21 and Sep. 22 the market was up and only on Sep. 23 it fell (and there is a long signal for close of Sep. 23). So the bearish signal from Thursday may very well mean that Friday the market would go up (which it did indeed; the algo also gave an intra-day bullish signal in the morning which disappeared later after the price went up) and would fall on Monday. This is about the market. In regards to VIX, I expect this up-move to be temporary (one day only) and I don't expect the price to go above Sep. 21's high (or not significantly so). I also expect a bullish signal for the market from the algo at close on Monday.