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TVIX - potential super bullish setup for volatility
Folks I want to show a potential bullish setup for volatility.
Off the low we made at 18.67 on 23 April 2019 we have got an a-b-c up pullback.
There could be two options to count that pullback. The first one, hat a-b-c up was all of the correction. But we have the same problem. It was shallow if to compare to the magnitude of the whole decline off December 2018 low.
However, there is another potential setup where the a-b-c move up that topped at 31.86 on 9 May 2019 was only the first leg up in wave A. The vast majority of corrective waves start with a countertrend a-b-c move.
Off that top we have got a clean a-b-c down decline which looks really good to be wave b down. That sets up a stage for another move up in wave c up. And that final wave c up has to have an impulsive structure. At minimum it should target 100% extension of the rally into May top (100% = 34.60 ).
Look how TVIX is approaching 200 MA from above. I am sure many traders watch that bullish wedge.
Now lets look at the micro picture ( chart below) . At this point we have a fully completed structure of that a-b-c down decline. It can complete any second. But at the same time it can extend lower into the green target box.
I will keep watching and hope it will tag 21.06 fib below.