It was certainly nice to see September end. September 2015 was the worst September in 4 years. Volatility as measured by the CBOE Volatility Index known as the VIX throughout the month never closed below $20.00. The VIX Index chart below for the month of September does show that aside from last week, the Volatility was trying to decline. Indeed on Friday the index closed at $20.94 while in the afternoon it hit a low of $20.35.
With many analysts looking for a strong pullback or even the potential for a severe correction this month, it may pay to be cautious. However I have not traded the VIX Index in September since selling my call options at the end of August during the August 24 panic sell-off.
CBOE VIX Index For September 2015
VIX index for September 2015
Momentum in the chart above shows a decline starting again on Friday. A decline in momentum is reverse to that of the market indexes. A decline in the VIX is a good sign for stocks. Whether this can hold is difficult to say as there were four such declines in momentum during September and yet September saw strong whip-saws and many hundred point days on the Dow..
The Week Ahead for the second week of October is lengthier than usual as I look at a number of topics this week, including some upcoming quarterly revenue results, what stats I think are going to be important this week and some trade ideas I will be entering this week…… the rest of The Week Ahead article is for USA Members.
The Crash Month – Investing Strategy Notes And Trade Ideas for The Week Ahead – Second Week of Oct 2015
FullyInformed USA Members can login directly through this link to read the investing strategy notes for the week ahead or they can sign in to the full USA members site here. Non-members can join FullyInformed USA here or read about the benefits of being a member.
Disclaimer: There are risks involved in all investment strategies and investors can and do lose capital. Trade at your own risk. Stocks, options and investing are risky and can result in considerable losses. None of the strategies, stocks or information discussed and presented are financial or trading advice or recommendations. Everything presented and discussed are the author’s own trade ideas and opinions which the author may or may not enter into. The author assumes no liability for topics, ideas, errors, omissions, content and external links and trades done or not done. The author may or may not enter the trades mentioned. Some positions in mentioned stocks may already be held or are being adjusted.
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