VXX – S&P VIX Short-Term (Last:16.45)

Eager as we’ve been to buy call options on this man-eater, the Hidden Pivot targets we’ve used to bottom-fish have only prevented us from getting sucked in by fleeting rallies over the last two weeks. There is only one way to buy VXX: on weakness. Chasing upthrusts can be fatal, since they often reverse so precipitously that even the trader who times his entry perfectly can miss getting out profitably. We did far better than that on our last outing, buying 16 call options for an average 0.54 that doubled in price within hours and eventually quadrupled.  When we exited the last of them on Friday, they were still in-the-money. All subscribers who reported doing the trade were profitable, many coming away with $1200 or more. Let’s try it again, this time with a bid for calls predicated on the pattern shown.  Specifically, bid 1.30 for four April 28 15 calls, good till canceled.  Check back nightly, since this gambit is likely to be modified or even canceled if VXX bolts for the blue. The bid is predicated on a moderate drop to the ‘secondary’ Hidden Pivot at 15.33 (see inset) where support has materialized several times. We are not bidding at the 14.09 target because I can’t imagine S&P volatility deflating to such an extreme in such a nervous environment.