Wild Ride - Volatility Remains Intact

February 18, 2018

 

In the past week the markets have been having crazy days, sometimes 1,000 point swings starting up, going negative and then closing up - in some cases closing down.  Mark Cuban is hedging the swings!  All this was brought about by a sudden and historical surge in the VIX - the CBOE Volatility Index. 

 

Some people are saying that it was all a setup!  That there was no real reason for the VIX to spike like it did - why?  Because it never has before even when we appeared near war or other catastrophic events.  They claim the VIX was spoofed by groups getting together - positioning to make millions on a VIX spike and then executing orders far out of the money and the bid price to create a false set of data that the algorithms would see/read and in doing so create a chain of events to create the spike.

 

Maybe there should be a secondary stock market that prohibits algorithmic trading and thereby prevents manipulation?  I would certainly be in favor of that because it would level the playing field and stop the ability of large players spoofing the market and creating false readings.  

 

The markets are still bullish but volatile.  We are not sure when they will settle back.  We are pleased that our last alert provided a return of 29% in the face of this turbulance.

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