How to use the VIX to your advantage

The Hawkeye Traders E-Letter — Your No. 1 Source for Volume Trading Insights

Hi Trader, Lately, I've been keeping a close eye on the VIX, better known as the volatility index. The good news is that since mid-May, it's been staying under 30 consistently… Of course, that's still high compared to pre-Covid levels, but it seems to be stabilizing. What's more, we're beginning to see lower highs and lower lows, which is a marked sign of a trend. Here's the VIX overlaid with Hawkeye volume:

Now, Hawkeye traders know that green represents bullish pressure, and red represents bearish pressure… But on the VIX, these colors are inverse. So, as volatility was rising amid the coronavirus selloff, you see the indicators turning red… And now, we're seeing the opposite as markets continue to recover their losses. But here's what's really interesting… We can also use the VIX to help us spot and confirm price reversals. Check this out…

Up top is the daily S&P E-mini futures daily chart, and at the bottom is the VIX. Here we can clearly see that as the market was selling off, the VIX was rising in conjunction, just as we'd expect… But then, as price started nearing the bottom of the range, we started to see the peaks in the volatility go DOWN as well. That's called divergence… And it was a bullish indication that a reversal was near. Coupled with our volume indicators on the weekly timechart, this essentially told us where the bottom was… And when it was safe to get back in. This is just another example of how volume gives us a more complete picture of market activity… And helps us stay on the right side of emerging trends. Now if you're new to the concept and want to learn more about the fundamentals of the Hawkeye methodology, we've got you covered… Just click right here to watch a free training video where we'll break it all down for you!

"This" Signaled a 527% Options Move In May… What Will It Do In June?

Lately, the markets seem to have a mind of their own, completely disconnected from economic reality. Meanwhile, the economy is in turmoil and conditions seem to grow more chaotic by the day. But despite the uncertainty, there are still profitable trades to be found. In fact, this one signal continued to grow our members' portfolios through the month of May… And it was even responsible for a 527% call option move! But June is already setting up to be an even hotter month… And members have just received two piping-hot buy alerts on a couple of BIG opportunities. So if you'd like to learn exactly how we're finding winners like these despite heightened volatility and confusing market conditions… Then click right here to claim your spot in an exclusive live event happening TOMORROW at 2 p.m Eastern!

Crude Corner: Oil Industry Insights, Market Analysis and Price Outlook

To call this ride crude oil has been on "wild" is clearly an understatement. From prices trading at nearly NEGATIVE $40.00 a barrel when approaching expiration of the May contract, to the Saudi & Russian price war, pared with the global economic shutdowns generating over supply and completely depleting demand - to a historic comeback of prices rallying nearly 90% during the calendar month of May. This year thus far has undoubtedly been the wildest ride of my trading career! The craziest part of all of this is the insane opportunities the market continues to present. To think looking back that I've made less money in calmer seas than these rough unpredictable times makes this all that more exciting. Adversity often presents opportunity, and that's exactly what is happening throughout all of this craziness. I suspect the crude oil market is most likely coming due for a short-term correction. A base of support is much needed to be formed which the market is currently lacking. The July contract has been rallying on average approximately $4.00 per week to the upside for the past 4 straight weeks in a row. Click here for more insights, analysis and outlook on this week's crude oil action!

The Hawkeye Team

Hawkeye Traders team1@hawkeyetraders.com hawkeyetraders.com

Call us: (888) 233-8598

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