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Monday, July 13, 2015

What I'll be watching today


10:15 AM market comment for you. Let's see how this works out today, eh?

So $VIX has dropped, but only back to 14.50 so far:


So the question is, given $VIX is just an intraday measure of demand for downside protection, are traders done buying their downside protection? Were they buying it to protect from Greece or China, or because they're just scared of poor earnings reports caving the US market?

And the problem is, $VIX has only dropped to the daily short EMA and Bollinger, and the weekly SMA(50):



Which makes me fear that this might be all the $VIX pullback we see, and that a bounce back up could be in the cards. Y'know, like when Americans realize the Greeks have to actually vote on this German "bailout" plan. I'll feel better if $VIX breaks through all those squiggly lines.

Meanwhile, despite FXI doing fine today, ASHR is continuing a selloff, which suggests Americans are using this weekend's bounce to sell and GTFO.

I'd assume American capital is just one tiny part of the Shanghai market. But maybe Whitey decides to buy downside anyway, as he sees ASHR's NAV go negative again.

I have a feeling it'll be a few weeks before Americans realize that they have their own stock market, whose value is completely independent of China. In the meantime, expect panty-piddling.

So anyway, seeing some big wins that I wanted to protect, I dumped 1/3 of my HVI.to this morning for a quick $900 book. Which would have felt better if I'd hadn't booked a $1600 loss last week getting the fuck out of MUX before it goes to $0.

No need to sell all my $VIX short: HVI.to and XIV seem to make their real money by shorting the time premium in the front month $VIX futures, which is usually a slam-dunk win, so there's still a lot of money to be made long-term. But it's nice to take a profit, and holding a sizeable chunk of one's portfolio in a $VIX short seems a little bit insane, as in rabid, as in seriously you should be institutionalized.

So let's see if $VIX continues to drop today, and if the QQQ continues to recover. In any case, I felt very happy this weekend with most of my money in HVI.to and HQU.to.


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