Thursday, 24 March 2016

TVIX, UVXY - a sixth net weekly decline

It was another rough week for the 2x lev' bullish VIX instruments, with TVIX and UVXY seeing net weekly declines of -4.4% and -0.7% respectively. Near term outlook offers further downward pressure on Mon/Tuesday, but the VIX looks set to battle upward to the key 20 threshold by early April.

TVIX, daily

UVXY, daily


*first, an update on the VIX, which saw a net weekly gain of 5.1%.

As for TVIX/UVXY, both instruments broke new historic lows this week, as the VIX equalled last Friday's floor of 13.75 on Tuesday.

*I'm looking to build up a long-VIX position across the next few weeks, seeking VIX 30/40s by late April/May.

There is serious threat of VIX 50/60s, if market turmoil in June - not least if the UK votes to exit the EU.

As ever, such leveraged instruments are for short term holds (almost always), due to the underlying problem of statistical decay.