1. In what circumstances would rule 3 of apply? And, what
do the arrows represent?
2. In most cases the VIX BB SPX system rules do not
trigger? In fact only the last to VIX sells seem to have
triggered but none of the BUY arrows fullfilled the rules?
Think of it as a guide (Matt added the word system but I changed
to guide) to watch for oversold or overbought readings near the
extremes. The buy arrows are simply pointing out support/resistance
areas..don't overthink things. This is SIMPLY a GUIDE and something
to supplement your trading signals. The previous bounces
occurred from an OVERSOLD area (not necessarily below the lower
band) and received a trigger with reversal candles. Again,
the IDEAL trade is based upon closes OUTSIDE the bands followed by
a close back within (providing the signal). The confirmation is
simply what traders follow to see if the reversal will hold. My
advice is to focus on the instrument you are trading first and
foremost and adhere to those triggers. For example, if you are
trading the SPY based upon the VIX setup then determine you trigger
on the SPY chart in accordance with your style of trading. The
arrows are simply showing where price has found support and
resistance lately. Currently, the market is also dealing with
a news driven item overhanging the market with Greece and that can
be quite fluid. Lastly, when the VIX is oversold, hedging (via VIX
calls) can be an option for traders who are holding longs and want
some protection. Hope this helps. Don't hesitate to ask me further
questions in my private in box.
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VIX Bollinger Band SPX System
Posted by bgold on 24th of Jun 2015 at 08:55 am
http://bpt-news-images.s3.amazonaws.com/2576_1435093398.png
1. In what circumstances would rule 3 of apply? And, what do the arrows represent?
2. In most cases the VIX BB SPX system rules do not trigger? In fact only the last to VIX sells seem to have triggered but none of the BUY arrows fullfilled the rules?
VIX
Posted by steve on 24th of Jun 2015 at 09:08 am
Think of it as a guide (Matt added the word system but I changed to guide) to watch for oversold or overbought readings near the extremes. The buy arrows are simply pointing out support/resistance areas..don't overthink things. This is SIMPLY a GUIDE and something to supplement your trading signals. The previous bounces occurred from an OVERSOLD area (not necessarily below the lower band) and received a trigger with reversal candles. Again, the IDEAL trade is based upon closes OUTSIDE the bands followed by a close back within (providing the signal). The confirmation is simply what traders follow to see if the reversal will hold. My advice is to focus on the instrument you are trading first and foremost and adhere to those triggers. For example, if you are trading the SPY based upon the VIX setup then determine you trigger on the SPY chart in accordance with your style of trading. The arrows are simply showing where price has found support and resistance lately. Currently, the market is also dealing with a news driven item overhanging the market with Greece and that can be quite fluid. Lastly, when the VIX is oversold, hedging (via VIX calls) can be an option for traders who are holding longs and want some protection. Hope this helps. Don't hesitate to ask me further questions in my private in box.