Market Update For Thursday: Turning Points


In addition to the UVXY Buy Signal and the Stochastic Sells set out below, SPX has spent most of today on either side of its all important 200 day MA. It's just a little unnerving that so many confirmations to the downside are occurring at once...but as the cliche of all cliches point out: It is what it is..... 


The UVXY trade that was discussed in yesterday's Update was triggered today as UVXY rose and stayed above $45.00. Whether the trade was entered earlier in the day, or later today just before the close, the expectation is that UVXY will be rising well above current levels in the weeks ahead. Getting in one day or the other, or buying  one call or the other, or at one price or another, are all secondarily relevant. The trade is to be Long volatility (via UVXY/VXXB) going into April and May. 

Contemporaneous with UVXY breaking out of its downtrend channel was its Stochastic breaking out above if its zero line (see yesterday's UVXY chart). Numerous other stocks and ETF's also generating stochastic-based trading signals today, all of them Sell Signals. [Those who go back far enough with Allan probably remember his, "Double Stochastic," trading system which he used for trading OEX options in the late 1990's. Yes, he's still a fan.] Below are some of the market index stochastic sells being generated today.*

*Note that these are trend reversal signals as opposed to trading system signals. The former precede the latter, and as this new downtrend unfolds system signals with accompanying option recommendations will follow.