Once again this market bellwether trading model is on the verge of a Buy Signal. VXX reverses Long @ $35.89 or higher at 1:30 PM (EST). VXX represents one of the most highly leveraged ways to trade a down leg in the market. The chart below shows that unlike the previous Long on Oct 25th, this Long would be off of a double bottom formed by the lows of the past two weeks. As such, in addition to a trend-signal line trade, this would also be a pattern recognition trade. I like the set-up. If the Long trade is triggered, we will be buying the Dec $36 call. Aggressive traders may want to consider the Dec $40 calls, currently trading at $1.90.
