VXX is a killer indicator

BY ANDREW GIOVINAZZI

July 31, 2024

Yo Pit Crazies,

Mark and I go live on Friday with a VXX trade for the ages. We have been killing it on the Vol Products this year and we have another one right here. Join us

So Microsoft Corp (Ticker: MSFT) did not make anyone happy with earnings today but Advance Micro Devices (Ticker: AMD) did. That set up Nvidia Inc (Ticker: NVDA) for a rebound after a terrible couple of days.

Mark and I said price for perfection and while the earnings are ok, there is nothing perfect about them. AMD was already down $90 for the spring peak so a $6 move is no big deal. What we have right now is a bumpy earnings cycle and the Invesco QQQ Trust (Ticker: QQQ) is down close to 10% from the peak. I dont see how Apple inc (Ticker: AAPL) creates the thrust higher but i have been wrong about AAPL for the last 3 months. AI and stock buybacks have kept it close to the new all time highs this year.

VXX 5 day chart with 1 min candles

As I write this the story for this post is the iPath Barclays Series B VIX short term futures ETN (Ticker: VXX) is just up after hours.

The question is will it stay there and how to use it as an indicator.

Follow me.

VXX struggles to maintain an uptrend

The Tuesday high for VXX was just over $49. After hours with the MSFT earnings it cannot retake the highs of the day. As a matter of fact it is struggling to stay green only up .10 on the MSFT disappointment. That is where VXX makes a great indicator.

When VXX is not going up it is going down

Mark and I will hit on this Friday. As the earnings roll out this week there is less to generate known volatility and it will be very hard for VXX to keep jumping. It should start doing the opposite. Just because the broad market does not rally, does not mean VXX can’t tank.

Join us.

To Your Trading Success,