Wednesday, May 05, 2010

Midday and struggling

Here are 2 views of the same thing. . . the VIX and the NYAD. The idea was to see if there was any difference in the clarity of the signals by taking opposite views. To my eye there's not, although the scale of he VIX chart might make it a bit more dramatic.
Looking at the VIX chart we can discern a clean VIXEN cross at 9:55 in real time (remember, the crosses float with time) and the close below the 8 hi/8 lo channel was one confirmation, further supported by the parabolic SELL. There were a few potential whipsaws along the way but the real signal to exit market longs was the 12:00 reversal. This was an in-your-face signal that things were about to change. The swings in the TICK today have been particularly wide -900 to 809, reflecting the current market instability and many 800 point swings occur over the course of a single 2 minute bar, so best to pay close attention if you're just playing this intraday.

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