VXX bottomed on December 9th at $16.28. In the 4 trading sessions since it has risen to $18.45 before falling back to $17.45 yesterday. This could be the beginning of a new VXX uptrend. An hourly close above $18.00 will trigger a short-term Buy Signal. In general a 10% move in the underlying index equates to about a 100% gain in 3-4 week at-the-money calls. At $18.00 a 10% move takes VXX to $20. The January 15th calls (30 days until expiration), gives almost a full four weeks for the index to move up 10% or better. Here is the trade: Buy Signal Pending: VXX above $18.00 at of the bottom of any hour (sooner if the advance is accelerating - use your judgment). Option if Triggered: Jan 15th $18.00C (currently 1.80-1.85) Note: As always with VXX, this is a high risk:reward trade. For anyone using a 50% stop, it is probably better to just allocate 1/2 of usual capital and hold calls without a stop. This is also a trade that can be taken with VXX shares in lieu of calls.
