In NFTRH 610 it was noted that I took a couple of bear positions due to the VIX Hammer candle at the SMA 200. Well, yesterday it did the same thing and I don’t like it as a mostly bull positioned (TZA and CVX are my only shorts, as SPXS was sold) player.
Here is the daily chart showing the 2nd Hammer in 2 trading days.
Unfortunately, I did not look at this yesterday or I’d have made an update about it. In short, while trying not to sound undo alarms it’s a very short-term divergence in the VIX to the market’s bullish activity and I don’t like it. I’d prefer not to have to manage risk on a down market day but these are the cards being dealt. My net profits this year have been very good and I believe it is time for me to raise cash.
If the Hammers turn out to mean nothing, VIX fails the SMA 200 and gulp, looks to fill that gap down there at 17.50 then… move along, nothing to see here. But until then I don’t like this picture.