Guppy Charts

Guppy charts are an interesting way of viewing the market.  To create the charts you plot shorter Ems 3,5,8,10,12, 15 and longer EMAs in a different color 30, 35, 40, 45, 50, 60...   The profit zones live in the the "white" area of the chart where the slower EMAs have left white space over the longer periods.

It is a useful exercise to look at weekly guppies on breadth charts.  The advance / decline line is clearly becoming bearish.  Although not there yet... this is not a a place where you want to stage a fight against the market trends.

The Dow Guppy has already created bearish white space

But the nasdaq remains in the thick of the fight between bulls and bears:

Summary
Trading is treacherous here and likely to break to the down side, but bears may be early as the Nasdaq remains in the thick of the fight.

VXX DRIP

When the market sells off quickly, traders get excited and rush into VXX, UVXY, and other volatility instruments. I'm holding XIV as a long term trade.  I have to make a confession.  I'm getting crushed on this trade. 

 Despite getting crushed in the short term, I have little concern that this will be a tremendously profitable trade. History shows long volatility to be a losing proposition long term.

(Chart per P.O.P. Stephen Stewart's public chart list)

The reason I  have absolute confidence in this trade despite the instant surrounding is that I did it in 2011.  I shorted VXX on Aug 9, 2011 at 32,  I shorted again on 8/19/11 at 42.

Ignore the VXX split adjustments.  My 2011 trade looked liked this:  Short term pain, long term gain.

The risk I take in doing this trade is not so much financial, it is the risk that my violations of every trading rule I have becomes a habit.

Why is it that nearly every top trader got their ass handed to them at early points in their career. 

"I’ve lost my entire net worth several times over the years getting caught up in stock and/or market crashes."  -- Jesse Stine