Comment: SPX / SPY with undefinite bias / Volatility (VIX/VXX) with undefinite bias.
The Volatility Indicator is a proprietary measure of the core market volatility status. It considers parameters like VIX, VVIX (Volatility of VIX), and Contango / Backwardation level. This is a short-term view of the market volatility and will support the decision process of which strategies to apply.
For ease of understanding, it uses a color code that ranges from RED to GREEN, using shading to easily understand the strength of the broad market volatility status. It does not measure the volatility of individual stocks. When the market can go in either direction (always in terms of Volatility), it turns YELLOW.
It will be posted and computed with end-of-day parameters for the last 10 days to give a dynamic perspective.
Below, you have a cheat sheet to guide you on which strategy to choose under current volatility conditions.
GREEN – Market is calm with volatility moving down (or at lower levels) and Contango is high
YELLOW – Market is changing its volatility status or in a mid-point that can continue its move (ex, from low to high Volatility) or retract (ex, low to mid and then move back to low volatility)
VXX CROC Trade
Best Trade
Ride Trade
VXX Surf Trade (in case the market resumes and volatility is expected to move down)
VXX Short Vertical (in case the market resumes and volatility is expected to move down)
Pro Iron Condor (selective)
RED – Market is under correction mode, with high Volatility and most probably options chains are under backwardation