Low Volume, The Bane Of Bears; What's Behind The Wide $VIX Spot/Future Spread

Collective Intelligence!

Snippets: And yesterday’s new all-time record falls to the wayside … leading to more white flags a fluttering –  for some – NO mas … On May 6put/call ratio for ETF s over 200% - bullish on Tuesday shifted, sinking to under 100% last 2 times market pulled back – stephen.  A note from Dick Arms: An extreme lack of fear begets instability. There are times when the market gives the impression it is fading into nothingness. Volume becomes very low, trading ranges become very small, volatility becomes very low. Also, there is very little change in market levels, and day-to-day fluctuations are minimal. Looking back at history, when that happens, it is almost always a sign of a market high point.  Now, Dennis Gartman: We Were Wrong Calling for a Correction http://on.wsj.com/1mrjxTl  

william_blount (08:18) every once in a while the commentary has a little conceptual thought in it-I actually like to write it for something a grain wizard told me to do back in 1989 – ‘make it so my 7th grade daughter can use it’ – EXTRACT THE PRICES, look at the pictures  -  today had a little conceptual work thrown in from 2006 but it is LITERALLY VISUAL – at 1913.50, on the high. At the end of the day each trader must decide which way he or she thinks the markets are going. For me, it’s simple; nothing has changed. For the last two years the market timers, from Robert Prechter of Elliott Wave to Tom DeMark to Dennis Gartman, have all cried wolf. WHO YOU GOING TO READ ME or them? ROFLMAO  –  no time to explain, but DICK ARMS is EXACTLY RIGHT, he just fails to COMPLETE THE thought …

[VIX] is up today and y’day, but the June VIX future is down. With the VIX this low the spread between future and ‘cash vix’ is abnormally wide at 1.5 points. This is likely due to market skepticism that the VIX will stay below 12% for an extended period of time – Mikey_ P.  Day count mikey … June Vix Futures settles into spot vix on expiration and you’ve got all those July market holiday days in the fwd then. most ppl taking that entire wk off – parker_schwartz. what ya wanna see is VIX DIVERGENCE higher lows – william_blount.

GAECKE Quant Report positions: QQQ triggered a sell y’day at 91.00 ▪ The last [QQQ] sell was in October 2013 for a small loss of 0.55%.

Today started with 175k ESM traded on Globex, trading range was 1914.00 – 1908.25. Yesterday’s regular trading hours (RTH’s), pit session trading range was 1910.00 – 1904.00 before settling at 1909.20, up 12.3 handles. stockmarketwhisperer (08:29) Today should be choppy … New moon completes in RTH … thus, short term top can complete… downside bust of 1905 gives Bears the keys to the south. 7:00PST and after 11:40PST important  for action/turns.

Today’s RTH’s, pit session, opened sharply unchanged at 1909.00 – 1909.50  with the first 15 mins trading in the 1910.50 – 1907.50 – before printing an intraday low of 1905.00 at 9:47. william_blount (08:46) looking for trending day today – if up, probably compressed to normal range. if down NORMAL = 6-8 – compressed…. normal is 9-11.5 and if we get stoopid , expanded is 16.5 + … SPILL AND HOD need to be fixed if you are a BEAR. PivotBoss (08:49) buy imbalances formed above 3722 NQ and offered. Chance (09:00) [IWM] getting smacked. william_blount (09:12)  INVERTED T’S satisfied – SPILL WAS THE 79% UP – the dump to the a.m. low in progress – JUST BECAUSE THEY ARE SATISFIED DOES NOT MEAN WE CAN NOT GO LOWER — yesterday OPENING 05, mid p.m. low titty bar 4.75 — BEARS MUST KILL THAT — keep the trend down day going — they MUST keep 1909 CONVERTED = todays opening. Chicagostock (09:17) ES vol window 1904×1914 – Sell stops < 190350 yesterday’s cash open. Support 1899 based off Friday’s high. PivotBoss (09:30) NQ with buy imbalances above VWAP again…and offered. FuturesTNT (09:41)s&p looks for the 1901.70 price as support – looking for the 30 year to test 138.22http://bit.ly/1lRpes6. Chance (09:37) market fairly balanced here.  And we have learned what that means, quietly grinding sideways to higher markets … mts2 (09:44) SPY puts – ev/m basically, atm 190p just traded 50k times. Chicagostock (09:46) 61.8% Fib extension from last May’s low keeps lid on highs (for now). $ES_Fhttp://stks.co/e0bNb  PivotBoss (10:11) ETH VWAP been offered in NQ all morning so far… back at it now (10:14) back to OPEN, 1909.25. PivotBoss (10:34) NQ went bid thru VWAP, now approaching prior rejection at 3723.

@PivotBoss Midday Video http://bit.ly/Sfvcvt Updated ADR Targets http://bit.ly/1knY6EW

@FuturesTNT  http://bit.ly/SQMEHg

Following the midday grind, basically holding the opening range low – sideways to the intraday high of 1912.00 at 12:54.stockmarketwhisperer (13:10) 12:02PST should be negative at least worth a few … TUG-O-WAR … Tyra (13:37) ES back to the OPEN, 1909.25… can be long idea here, with higher low on price and lower low on oscillator… risk is below OPEN … in this type of setup, with higher low on price and lower low on oscillator, can have a catapult effect … idea is that oscillator has “stretched” too far … can be like a slingshot thing… OPEN needs to hold … Tyra, slingshot down? Tyra up. http://bit.ly/1hz4YdI  william_blount (13:38) so ya rally 45 gann handles in 5.5 sessions and you spend the past 2 in a 8 handle box — man , even Ms Marxche has to rollover and have a smoke now and then – NOTHING HAS CHANGED – 1909 TELL THE TRUTH. Tyra (13:50) OPEN, holding… needs to get up through first 15 min high, 1910.50 and hold for longs … The 1912 high was retested / rejected by 2:18. The MiM – MrTopStep Imbalance Meter started with a small to modest sell imbalance $197M, then up to $250M redliontrader (14:45) 1/2 of the sell side is in [WFC] and [PSX] before growing to $330M going into the cash close. The cash close traded 1907.60 followed by a small bounce before settling at 1909.10, down.10 – fractionally on very light volume of 1M e-minis, while the [VIX] was up 17 ticks.

stockmarketwhisperer (14:50) what is with this pathetic volume? ugh

william_blount (14:52) it has been the bane of BEARS in grinding 3rds for almost 3 years SMW.  DICK ARMS is SPOT ON — grinding 3rds are the precursor and diminished VOLUME part of the TELL before we MORPH to AV or DOWN TONE BUT AND THIS IS A BIG BUT – FINDING THE END OF THE GRINDING 3RD IS THE deal and many a BEAR in the morgue because of that one critical witches tale over the past 3 years ‘we have to go down, there is no volume’ = we HAVE TO GO UP because you have no anxious supply and LOOSE MONEY.

Mikey_P (14:55) Kind of like, option traders don’t die, they just expire worthless! But so far my short from 1912 seems ok.

william_blount (14:56) bears got the 68 –the lean will be s2H tomorrow — best shot they have had in 8 sessions for a pullback – they ACCOMPLISH nothing until 1887.

stockmarketwhisperer (14:57) I’m with you WB.. …and closing on the lows today would help.

Eco calendars: http://www.investing.com/economic-calendar/    http://www.dailyfx.com/calendar
What housing slowdown? Toll Brothers’ sales leap  http://bit.ly/1nVj256