I think the SOXL idea is statistically better than UVIX since SOXL goes up most of the time while UVIX goes down most of the time. Buying early and setting a stop could be a very simple and profitable strategy for SOXL. However SOXL is known for wild volatility and will likely stop you out most days.
As for predictions of a market crash, I'll make one of my own but I don't plan on trading it. SPY is at a double top that is extremely obvious and the market has been going up for a long time. The market doesn't give obvious signs so I believe this is a bear trap. Any pullback will look like the beginning of a major crash, but will just lead to a new ATH.
At some point in the future, I really need to follow my own advice! Wow, UVIX +38.3%, UVXY +29.6%, SOXS +22.7% from Friday's close. I certainly wasn't expecting that when I wrote the article yesterday, yet the main message of the article was to simply act early and let it run. Following that advice would have given great gains from buying at the open: UVIX +32.8%, UVXY +25.9%, SOXS +16.1%. I find it hard to believe we'll get a repeat of the early August move, but there's no reason to have sold. I did, but that may turn out to be another bad decision.
Today was a great example of simply buying early and letting it run, and it worked with either UVIX or SOXS. It's incredibly tempting to sell early and take the quick gain but it's almost always best to let it run till at least 10 o'clock. It's then tempting to buy SOXL with a tight stop, which can work well, but I haven't had a lot of success with it. Yes, SOXL goes up most of the time and UVIX drops most of the time, but the message of the article was to take the quick gains with UVIX when the situation presents itself.
I decided to buy SOXL at 33.85 and a stop sell at 33.59 (-0.77%), just below the early low of 33.69. I also stopped out of UVXY at 24.19 and put in a stop buy for a small position at 24.52, just above the high of 24.43. It fell back to 23.96 and then pushed back up like it so often does, and SOXL broke lower, as it so often does. More work and less reward.
As a comparison, UVIX gave +10.8% from the open to 10:30 and SOXS +8.5%. Both good, and perhaps SOXL is now a buy at 33.00, I don't know, but the easiest strategy is to simply let your winner run as long as you can.
I think the SOXL idea is statistically better than UVIX since SOXL goes up most of the time while UVIX goes down most of the time. Buying early and setting a stop could be a very simple and profitable strategy for SOXL. However SOXL is known for wild volatility and will likely stop you out most days.
As for predictions of a market crash, I'll make one of my own but I don't plan on trading it. SPY is at a double top that is extremely obvious and the market has been going up for a long time. The market doesn't give obvious signs so I believe this is a bear trap. Any pullback will look like the beginning of a major crash, but will just lead to a new ATH.
At some point in the future, I really need to follow my own advice! Wow, UVIX +38.3%, UVXY +29.6%, SOXS +22.7% from Friday's close. I certainly wasn't expecting that when I wrote the article yesterday, yet the main message of the article was to simply act early and let it run. Following that advice would have given great gains from buying at the open: UVIX +32.8%, UVXY +25.9%, SOXS +16.1%. I find it hard to believe we'll get a repeat of the early August move, but there's no reason to have sold. I did, but that may turn out to be another bad decision.
Today was a great example of simply buying early and letting it run, and it worked with either UVIX or SOXS. It's incredibly tempting to sell early and take the quick gain but it's almost always best to let it run till at least 10 o'clock. It's then tempting to buy SOXL with a tight stop, which can work well, but I haven't had a lot of success with it. Yes, SOXL goes up most of the time and UVIX drops most of the time, but the message of the article was to take the quick gains with UVIX when the situation presents itself.
I decided to buy SOXL at 33.85 and a stop sell at 33.59 (-0.77%), just below the early low of 33.69. I also stopped out of UVXY at 24.19 and put in a stop buy for a small position at 24.52, just above the high of 24.43. It fell back to 23.96 and then pushed back up like it so often does, and SOXL broke lower, as it so often does. More work and less reward.
As a comparison, UVIX gave +10.8% from the open to 10:30 and SOXS +8.5%. Both good, and perhaps SOXL is now a buy at 33.00, I don't know, but the easiest strategy is to simply let your winner run as long as you can.