Friday offered a glimmer of hope in an otherwise bad market. There was a high volume reversal ending the day at the top of the day’s range on all of the major averages.
However, until we break back above the ST trends which are in the process of rolling over, we will be happy to be observers, with 2 exceptions…
If the market rallies back up into resistance and fails to breakout we will likely initiate positions on the short side using the QQQQ‘s and a corresponding VIX hedge which we intend to sell monthly premium against for income generation.
We have used the VIX successfully as an effective portfolio and market hedge over the years and the current market conditions appear to be setting up nicely for a VIX entry.
