Monday, 6 May 2013

Volatility back in the twilight zone

With chronically low trading volume, the algo-bots are in total control, and it is the default 'melt upward' action that is going to kill the VIX lower across the entire week. VIX closed slightly lower, -1.5% @ 12.66 Baring some 'major news/event', volatility looks set to stay low across the summer.


VIX'60min



VIX'daily3


Summary

So, VIX is in the 12s, and the 11s look a given at some point this week.

The only issue is whether we see 10s, which I think would be the lowest level since Spring 2007.
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In fact, the grander issue of the summer is arguably whether we'll see VIX <10, before this relentless equity rally from Oct'2011 is complete.
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more later..on those melting indexes

Closing Brief

The main indexes (except Dow) all closed moderately higher, lead by the Transports. As expected, the algo-bots appear to have total free reign over the market, and that looks set to continue for the entire week, if not a few 'months'.


sp'60min


Summary

What to say about this day of nothing?

...dull.
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*As an options player,  I can only console myself knowing that last Fridays exit was a good idea. Premium is being eroded on everything.
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The daily, weekly, monthly charts are ALL bullish.

Even as a permabear....I can't deny what this twisted market is back to, and it sure don't look like its headed down any time soon.

I realise a fair few out there are seeking a turn at current levels, but..I just don't see that happening anymore. Bears had their chance...and failed.
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Minor bits and pieces across the evening.

3pm update - Transports holding strong gains

Whilst the headline indexes (Dow, SP, Nasdaq) are only moderately higher, it is the old leader - Transports, that is again leading the way, +1.4% in the 6300s. Is it really too much to envision the tranny in the low 7000s within 3-4 months?


Trans' weekly


Summary

Near zero volume...thus ..as expected, the algo-bots are in total control.

Absolutely NO reason why tomorrow will be any different.
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back at the close to summarise todays 'nothing'.