TVIX, UVXY - just a little higher

Whilst equities saw some swings this week, the VIX remained broadly subdued. The 2x lev' bullish instruments of TVIX and UVXY settled net higher for the week by 0.5% and 1.0% respectively. Near term outlook offers a touch of upside on Mon/Tuesday, but broadly... the relentless decay will continue.


TVIX, daily

UVXY, daily

Summary

*first, an update on the VIX, which saw a net weekly gain of 8.1%

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As for TVIX and UVXY, most notable this week... new historic lows early Thursday, a major reversal (due to a spooky Deutsche Bank news story), but then renewed cooling into the weekend.

The underlying problem of statistical decay should remain clear.

For the more adept day-traders out there, such instruments can be used, but holding overnight, or across multiple weeks.... that almost always ends badly.

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Yours truly continues to see the VIX-long trade as dead... with zero intention of being long volatility until at least late spring 2017. That view only changes if the market breaks below sp'2050, which really doesn't look likely.

RIG - drilling out of the down trend

Whilst the main market settled broadly weak, there was notable strength in energy stocks, as oil/gas prices continued to climb. The oil/gas driller of Transocean (RIG) settled significantly higher for a second consecutive day, +6.1% @ $10.63. Next big upside target is the $13 threshold, after that... the $18/20 zone.


RIG, daily

RIG, monthly

Summary

The second sig' daily gain, and perhaps more notably.. the fifth gain of the past 7 trading days, since the Sept' 20th low of $8.68.

RIG is starting to look provisionally strong again, as the downward trend from July 13th ($13.03) has decisively concluded.

Now its merely a case of whether RIG can break above the key $13 threshold before year end, and then hit the 18/20 zone by late spring 2017.

My outlook on oil/gas is bullish into next spring. If that turns out to be correct, most energy stocks - such as KMI, APA, APC, CHK, and RIG, should broadly climb in the months ahead.


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Here in London city...

A few drill rigs have appeared...

... but I'd guess they ain't drilling for Oil  :)

FCX - rising with Copper

Whilst the broader equity market closed moderately higher, there was notable strength in Freeport McMoran, which settled +6.8% @ $10.90. First target is the $14 threshold. Any daily closes above that would bode for upside into spring 2017 to the $20 threshold.


FCX, daily

FCX, monthly

Summary

*price structure on the monthly chart is offering a multi-month bull flag.
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Suffice to add... eyes on Copper. If Copper >$2.40 before year end, it will break a 5 year downward trend, and that will bode for mid term upside in FCX to $20.