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Post by theMist on Jan 27, 2017 10:53:26 GMT -5
Very slow grinding day................nothing moving significant enough for me to warrant a trade............. Same here
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Post by walnut on Jan 27, 2017 10:58:43 GMT -5
I used to think that way too. in fact I told Huh that it was flawed a while back. Because the returns on the scams are not normally distributed, and the patterns are derived from the patterns of other securities. So I have been pretty skeptical. But now I respect that TA on the scams is significant. BTW - I emailed Jim this morning to point out a few things he doesn't see on the charts. Basically, what I posted yesterday in S&P thread. Curious to see if he gives feedback. Do you know that there are some really smart traders who I admire that believe TA is absolutely useless when it comes to charting the SCAMs?! And you can make the argument that TA is useless because they are not supply/demand driven. Really? Then how do explain the large descending channel they have been in for years. Descending channels are made up of support and resistance. Also, how do you explain those GAP fill calls that I have made in the past. Then they argue that these products are double leveraged and skewed because of that. Then I simply say, but when I trade the SCAMs I chart S&P, watch VIX futures, and chart VXX (which is unleveraged). Anyway, just my 2 cents. lol
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Post by theMist on Jan 27, 2017 11:00:39 GMT -5
If you believe S&P is headed back to SP2284 like I believe. I would short SPY or UPRO.
Going long SCAMs not advisable with contango so high. Will take heavy prolonged selling to get them to spike hard.
They're even flat to slightly lower with the selling we have now. I am literally in AWE of the SCAMs and can't believe they even exist legally to be honest. lol
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Post by walnut on Jan 27, 2017 11:05:42 GMT -5
I am literally in AWE of the SCAMs and can't believe they even exist legally to be honest. lol
I know, I think about it often. We have been looking for an arbitrage trick to play the scams. But the scams are already a crazy trick. I don't know who keeps taking the other side of our short trades. ??
The offsetting factor is the huge jumps it makes 2 or 3 times a year. Makes it difficult to manage.
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Post by theMist on Jan 27, 2017 11:08:45 GMT -5
Walnut - even if anyone felt TA was useless when charting VXX -- You can literally time your short VXX position based off of charting the S&P along with having a strong knowledge of spot VIX, VIX futures (contango/backwardation).
Under contango, when S&P sells hard (VXX rising) and as soon as S&P hits support, you can take a short VXX position.. Then when S&P bounces back up (VXX dropping like a brick) and you see it start to hit resistance and possibly start to rollover, cover your VXX short.
Rinse and repeat. And during this whole time, you have contango as your friend.
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Post by theMist on Jan 27, 2017 11:11:09 GMT -5
I've wonder about this quite a bit as well. You would think that shorting the SCAMs is an overcrowded trade and I believe it is like Vance Harwood from Six Figure Investing would say. He even put out an article entitled "Is shorting, UVXY, TVIX, VXX the perfect trade"? That's why it goes hard to borrow some times.
So who is buying?? lol
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Post by novie08 on Jan 27, 2017 11:14:39 GMT -5
I don't know who keeps taking the other side of our short trades. ??
I did, remember? lol.
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Post by theMist on Jan 27, 2017 11:18:03 GMT -5
I don't know who keeps taking the other side of our short trades. ?? I did, remember? lol. Novie - are you able to daytrade/scalp like the rest of us? Or does time not permit? Keeping it small of course.
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Post by walnut on Jan 27, 2017 11:18:42 GMT -5
I warned ya haha
TheMIST will tell you when to short VXX Novie and it is coming up pretty soon
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Post by novie08 on Jan 27, 2017 11:23:10 GMT -5
I know. I'm just in and out so much, it's very rare to have a full day to stare at the screen. Don't worry about the loss, pos was so small it was only about $300 with fees. Gotta run soon again today. It's just easier for me to trade the miners a little b/c that is what is comfortable after all these years. Still those breakaway gaps are gonna fill one of these days. May have some time next week.
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Post by theMist on Jan 27, 2017 11:26:39 GMT -5
So who is buying?
I'm sure there are buy and hold investors that have bought the SCAMs over the past year and have gotten crushed. I'm sure there are PERMA BEARs out there that have bought because they are looking for the BIG ONE. Then there are those that have bought probably because they think the best way to play a market selloff in S&P is simply buying the SCAMs and find out the hard way since very few bother to read the prospectus. Then I'm sure there are those that probably believe it is a good hedge for their portfolio.
When I saw that my timing was off on trying to time the spike in volatility this time around, obviously I jettisoned out of the trade and went back to daytrading and shorting them. Unfortunately, buying the SCAMs as a long term buy and hold is a losing proposition in a bull market.
Keep in mind: During correction of 2011, TVIX would have spiked 550%. If SCAMs had been around during the Great Recession 2008-09, TVIX would have shot up 15X. I'm sure that's the reason why some still buy.
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Post by theMist on Jan 27, 2017 11:28:27 GMT -5
I know. I'm just in and out so much, it's very rare to have a full day to stare at the screen. Don't worry about the loss, pos was so small it was only about $300 with fees. Gotta run soon again today. It's just easier for me to trade the miners a little b/c that is what is comfortable after all these years. Still those breakaway gaps are gonna fill one of these days. May have some time next week. If playing the miners is what your most comfortable with and has been profitable for you -- then by all means stick with it.
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Post by walnut on Jan 27, 2017 12:01:55 GMT -5
Why is it so hard to stick with a short pos in the scams.. Why do we ever doubt
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Post by theMist on Jan 27, 2017 12:02:08 GMT -5
H&S still doesn't have validation/confirmation. Now for the bullish short term case. During this entire time with markets trying to make up their mind which way to go. SCAMs will continue to grind lower under contango. Small inverse H&S measures around 2297 but still needs backtested confirmation
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Post by theMist on Jan 27, 2017 12:04:34 GMT -5
Why is it so hard to stick with a short pos in the scams.. Why do we ever doubt I'm not doubting for daytrading /scalping on short term basis. I'm all for it. BUT on long term basis (months, years), I just don't think its a good time to start averaging in for a long term basis. They can still grind lower in short term. Long term, we are over due for a correction. IMO
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Post by walnut on Jan 27, 2017 12:07:02 GMT -5
I know
in fact bot back those last 3000 shares, made another 1200
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Post by theMist on Jan 27, 2017 12:20:36 GMT -5
S&P updated 5 min chart. Remember what happened last time when price action threw back over neckline and bear squeeze happened. Small iH&S forming. Have to see if it fails or confirms. Hitting triangle resistance (lower light blue line) as I type. During this entire topping or continuation pattern, SCAMS will drift lower. If S&P breaks above triangle support (upper light blue line), then good chance this entire pattern is a continuation pattern and should retest S&P highs. Leaving that S&P Breakaway GAP to fill another day. Jury is still out...
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Post by theMist on Jan 27, 2017 12:24:28 GMT -5
TVIX looks like it wants to test 5. Selling in S&P is very slow going and S&P about to turn green IMO
Unless that changes and S&P starts to dump, not a good idea to chase shorting SCAMs at this point. TVIX currently trading at 5.18. Watching S&P charts.
Contango at 12% now
Scottrade all out short TVIX -- lots of laughs. Would like to have just in case I want to take a stab at it if bounces higher. On phone now.
Anyone else find TVIX hard to borrow for shorting?
Scottrade just located a 120K shares to short TVIX. That should be good for a small scalp. lol
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Post by walnut on Jan 27, 2017 12:25:42 GMT -5
VXX now deep in the 18's
I would re-short after a bounce
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Post by theMist on Jan 27, 2017 12:39:25 GMT -5
S&P starting to rollover a little now at that triangle resistance (lower blue line). Small inverse H&S just failed to confirm. Even if S&P turns lower, this selling is so slow going that SCAMS will hardly budge to the upside at this point and even could drift lower.
So the Bearish short term case is back on the table for now.
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