VIX Begins To Implode From Extreme Levels
Continue to use extreme caution if you are considering
taking any new positions.
On a relative basis drugs
(
$DRG.X |
Quote |
Chart |
News |
PowerRating) and healthcare
(
$HCX.X |
Quote |
Chart |
News |
PowerRating) continue to hold up well. Look
for buying opportunities in calls and calls spreads here.
Gold and silver
(
$XAU.X |
Quote |
Chart |
News |
PowerRating)
remains the strongest sector. Look for buying opportunities in calls and call
spreads here.
For you OEX traders, the VIX began to implode
from its highest
levels since October of 1998. Under normal circumstances, this would likely
provide for a bounce play in the index followed by a reversion to the mean in
volatility. However, as you know, these are not normal times. We remain in a news
driven environment. Therefore, use extreme caution should you decide to take
trades here.
Looking Ahead
There are numerous
sectors in strong downtrends. These will likely set up on the short side on the
first bounce.
Best of
luck with your trading on Wednesday!
P.S. Reminder:
Protective stops on every trade!