We've had a bunch recently. Friday, Monday, Tuesday, and today.
And so far, they've all been right predicting a declining VIX. Mixed on the higher prices.
http://schrts.co/fBkIVfRU
VIX P/C Buy
#1
Posted 16 October 2019 - 10:39 AM
Mark S Young
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#2
Posted 16 October 2019 - 12:28 PM
But Jeff Clark says that call buying premium is much more than puts which he says is an indication stock market is about to drop
The S&P 500 closed yesterday at 2990. It’s up about 100 points over the past week or so. Meanwhile, the Volatility Index has fallen from above 20 earlier this month to less than 14 yesterday.
Once again, though, the VIX options are warning of a reversal.
For example, just compare the VIX November 20, $14 calls to the VIX November 20, $14 puts. The calls were offered yesterday at $3.25, while the puts were offered at $0.40. (I use my trading quote system to track these prices, but you can also find them here.) This was when the VIX was trading at 13.94.
In other words, even though the VIX puts are $0.06 in the money (meaning they have intrinsic value), and the VIX calls are $0.06 out of the money, the call options are trading for more than eight times the price of the put options.
VIX option traders clearly expect the index to move higher over the next several days, and even higher still over the next month. And a rising VIX (rising volatility) usually accompanies a falling stock market.
#3
Posted 16 October 2019 - 01:25 PM
I think the VIX options traders are smart money.
But so far, I only use that data for short-term prediction.
Mark S Young
Wall Street Sentiment
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#4
Posted 16 October 2019 - 01:36 PM
The SPX internal wave pattern still looks bullish to me, but is looking tired.