OptionsHouse

Options Trading News

February 21, 2013  Thu 12:45 AM CT

VIX: SEE CHART GET CHAIN FIND STRATEGIES
Fear--and volatility--came back into the market yesterday.

The CBOE Volatility Index leapt more than 19 percent yesterday, its biggest gain in more than a year, as equity indexes sold off.

The S&P 500 fell 18.99 points, or 1.24 percent, to close at 1511.95. The SPX gave up its gains of the last two weeks after coming off Tuesday's five-year highs. It fell virtually all day, but the selloff accelerated in the afternoon as shares finished at their lows. Resistance is now at Tuesday's high of 1531, while support is at 1495.

The Nasdaq 100 dropped 42.87 points, or 1.54 percent, to 2739.99, its lowest close since Feb. 4. It too fell sharply in the afternoon and finished at session lows. It has resistance at 2783 and support at 2715.

The Russell 2000 gave up its gains of the last week or so, falling 18.50 points, or 1.99 percent, to close at 913.50. Most of the losses came in the last hour. Tuesday's all-time high of 932 will be resistance, while support should be at 895.

All three equity indexes closed below their 10-day moving averages, and the NDX was even under its 20-day average. They also posted bearish "engulfing candlestick" patterns.
http://stockcharts.com/help/doku.php?id=chart_school:chart_analysis:candlestick_bearish_#bearish_engulfing

The VIX had its larget percentage gain since November 2011, up 19.25 percent. It gained 2.37 points to finish at 14.68, matching its close from the first day of 2013.

The VIX futures followed higher, with March contracts up 1.50 points to 15.40 and April futures gaining 1 point to 15.95. This drove the iPath S&P 500 VIX Short-Term Futures Note (VXX) up 8.6 percent to close at 22.83, coming off an all-time low from Tuesday.

More than 625,000 VIX options traded, with calls outpacing puts by 2 to 1. The VVIX Index, which measures the implied volatility of the VIX options, was up more than 13 percent to 79.65. It was at an all-time low on Tuesday.
Share this article with your friends


Related Stories

VIX

Video: Near-term VIX calls purchased

February 5, 2016

Group One's Jamie Tyrrell says volatility traders had been looking farther out but are now picking up February 28 calls.

VIX

Videocast: Huge VIX call spread sold

February 4, 2016

As the market continues to churn, Group One's Jamie Tyrrell says today's big trade is the sale of a VIX March 30/40 call spread 115,000 times.

VIX

Videocast: Big March call spread in VIX

February 3, 2016

As the market pulled back this morning, Group One's Jamie Tyrrell says a major player bought a March 30/40 call spread 150,000 times.

VIX

Video: VIX traders buying March calls

February 2, 2016

As volatility rises with today's market decline, Group One's Jamie Tyrrell says traders are purchasing the VIX March 30 and 35 calls.

VIX

Video: VIX traders split on next move

February 1, 2016

With the market pausing after last week's rallies, Group One's Jamie Tyrrell says traders are buying both March 15 puts and Weekly 20 calls.

OptionsHouse

Premium Services

Upcoming Webinar:

How to Defend Your Portfolio and Profit in a Market Selloff

http://bit.ly/1OSMWU6

Jon Najarian and Sandy Chaikin of Chaikin Analytics demonstrate how to play defense when the market is selling off. And, how to turn misery into money, whether investing in stocks or trading options.

Education & Strategy

The sweet spot

When using the Stock Replacement Strategy, we must remember that in reality, we are doing a STOCK trade. We are just using options. We are replacing the stock position with an option position (long calls).

View more education articles »