Todays move and nervous nillies. Meaning.. certainly not giving advise. If I were I would have a news letter and charge 500 a month and not post my thoughts. I do so because I like a record of where I think things are going and when wrong adjust my thinking. Having said that the vix is indicating to me that there could be a bit more steam here. Staying in the 20's is a nice clue.
A couple things are saying caution here. One is the move to 23.06 on the VIX that could not hold and fell back to 21.06 despite the close at the low on the big boards. The Dow's 50 day is 17267. Almost hit there. Breaks, and I am looking at the 200 at 16857.
The HVU crosses it's 200 day back on the last Dow drop of 1414 pts.. about 17% drop (17350 to 15936) The same drop here would put the dow at about 17575 dropping below the 200 day as it did in Oct.
What is happening? The HVU continues to move off any previous ratio established with the vix or dow. Yes, it could go nuts like Oct breaking Aug high leg. But notice how fast that happened. In 4 days 16.41 to 31.20 and the vix did it's 100% in 5 days from 15.34 low. Big fear came in there. With oil where it is, turmoil in Europe, and now this confession of US about torture that only serves to give more recruits for the bad guys, I still think the dow has to come back to at least it's year bottom uptrend. Other indexes are below their year so what makes these big shots think the dow should be where it is? Having said that, don't think the dow cannot top 20,000 in 2015 and the HVU be back to 2 bucks and change. That is what makes the HVU interesting.
How do I play this? I buy a position when the dow looks like it is topping and is confirmed by breaking the 20 day. I trade 1/2 on day moves but hold the other 1/2 until a stupid valuation or I stop getting higher highs. That way if she jumps to whatever, I always have some to sell into the hype. I always have a "loose" stop on the ones I am holding and move it up each day. Sounds simple but works for me. I lost lots until I figured out what they are doing with this beast. Fear and greed are hard to control but my training serves me well in that. I have a 3.. possibly 4 day window here. We will see where this lands.
So all the best to all as you play this. Please don't take advise from anyone on this board. Some lie, some don't. Some are kids with fake accounts and some are trading 2-4 portifilos into the thousands of dollars. Some are new to this and some have been trading for 40 years and paid their dues.
This is nothing but a fear index and I truly expect to see them do another rollback on this sometime down the road. They only have 1.6 million shares so another 1 for 5 would put them pretty shy of shares. Speaking of that. 1.6 million float and trades nearly 5 million shares. Sure must be a lot of buying and selling out there. I call them nervous nillies.