Volatility Snapshot: UVXY at New Lows
Good Afternoon Traders,
The VIX plummeted today, pulling UVXY to new all time lows. The VIX closed at 9.29 with Contango rising to an extreme 16.50%.
The extreme bullish action is signaling the market values tax reform and debt ceiling compromise over the downside implications of an additional rate hike in December. The positive market action could also be seen as a positive implication for the Alabama special election to be held Tuesday.
Looking at the SPX $2660 appears to be a resistance point. We would expect the market to push through $2660 to new highs before returning to this level for support.
We like to intraday trade XIV off pullbacks and unfortunately today, XIV simply left us in the dust without offering a signal.
The market is incredibly strong here, but we are continuing to stick with our trading plan and will wait for a sizable increase in volatility before establishing new UVXY short positions.