: Volatility Ebbs Lower After Early-Week Spike

CBOE VIX Volatility Index falls as stocks gain.

The CBOE VIX (NYSEARCA:VXX) weakened on Tuesday, as calm returned to the equity markets after a volatile start to the week.

 

The Chicago Board Options Exchange (CBOE) Volatility Index fell 4.3% to close at 18.20. The so-called “fear index” hovered between 18.09 and 19.31 during the session.

 

 

In equities, the large-cap S&P 500 Index (NYSEARCA:SPY) rose 0.2% on Tuesday.

Major VIX ETFs:

iPath S&P 500 VIX Short-Term Futures ETN: (NYSEARCA:VXX) Designed to offer exposure to the S&P 500 VIX Short-Term Futures Index Total Return. The Index uses CBOE Volatility Index futures by way of a long position in the first and second-month VIX Futures contracts. VXX declined 2.3%.

 

ProShares Short VIX Short-Term Futures (SVXY) to track the inverse daily performance of the S&P 500 VIX Short-Term Futures Index. SVXY advanced 1.4%.

 

ProShares UltraShort Term VIX Futures: (NYSEARCA:UVXY) UVXY is designed to deliver 2X (leveraged) returns of the day’s moves in the S&P 500 VIX Short-Term Futures Index. It tacks the two front months of the futures contract. UVXY declined 3.2%. 

 

VelocityShares Daily 2x VIX Short-Term Futures ETN (NYSEARCA:TVIX) TVIX is a leveraged VIX ETN designed to deliver 2X the returns of the daily S&P 500 Short-Term Futures Index. TVIX declined 4.1%.

 

The Final Word: The VIX is back to trading near its historic average, possibly signaling continued instability for stocks. 

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Should The Federal Reserve raise interest rates or Will it be harmful to economic recovery?

Should The Federal Reserve raise interest rates or Will it be harmful to economic recovery?

2018 interest rate hike
The Fed seems to be tightening its monetary policy recently: it began to gradually reduce the size of its $ 4.5 trillion balance sheet in October last year. At the same time, the market expects the United States to advance plans to raise interest rates gradually. From March 20 to March 21, the Fed will hold the next monetary policy meeting. The latest statement from the top decision makers shows that the number of interest rate hikes this year may reach four times – more than the three interest rate increases predicted in December.
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The euro continued to rise against the dollar regain

The euro continued to rise against the dollar regain the political risk of the week or around the euro

  Friday (March 2) The euro continued today the substantial increases against the dollar since the previous session, starting from a multi-week low, continued to rise above the 1.230 mark. Market demand for the euro is still increasing, promoting the exchange rate rose, the exchange rate hit an intraday high of 1.233, almost regain the decline this week. As of now, the euro against the dollar trading price of 1.2317, or 0.40%.

Concerns over the global trade war triggered a sustained propensity to sell the dollar after U.S. President Trump announced a high tariff on imported steel and aluminum, which seen as one of the key factors pushing the euro higher against the U.S. dollar.Download APP Read more in this article
  Concerns over the global trade war triggered a sustained propensity to sell the dollar after U.S. President Trump announced a high tariff on imported steel and aluminum, which seen as one of the key factors pushing the euro higher against the U.S. dollar.

  Meanwhile, the global stock market sell-off further supported the position of the euro as a financing currency, boosting the EURUSD continuation of the previous day’s trading momentum. Yesterday, the euro rebounded sharply against the dollar at a low of 1.2155 and hit a hundred points.

  The euro against the dollar the current exchange rate remained at 1.2320 near the transaction, the first recovery from this week’s decline. It may now be time to retest the 1.2540 resistance above the downturn in the U.S. economy. Although the US consumer sentiment index reached 99.7 in February, surpassing the previous forecast of 99.5, the euro as a whole still maintained its upward trend.

  In the meantime, the upcoming ECB meeting will be the next major risk event for the euro. Next Thursday (March 8) the European Central Bank will announce the March interest rate decision, most likely to delete QE flexibility related terms, but only slightly support the euro, as the European monetary policy tone will be partial to the overall pigeon.

  If expected to be realized, the move by the European Central Bank will be analogous to the situation in early June last year, when the ECB deleted the wording of interest rate flexibility and the euro did not respond immediately. However, at the end of June, the market started to price the ECB normalization Monetary Policy.

  Also, Italy will hold a national election this Sunday, the political risk may drag on the European Central Bank’s interest rate decision, and the German Social Democrats and the German Chancellor Merkel led the CDU to establish a ruling coalition will also vote on the same day.

Concerns over the global trade war triggered a sustained propensity to sell the dollar after U.S. President Trump announced a high tariff on imported steel and aluminum, which seen as one of the key factors pushing the euro higher against the U.S. dollar.
technical analysis
  The euro is currently under pressure at 1.2332 against the dollar, if stabilized below the level above, then the short-term resistance to see the 1.2390-1.24 range, and finally the previous test high of 1.2550 near the test.

  On the other hand, if the exchange rate fell again, the recent support at 1.220-1.2195 below the range, once again broken under the concern 1.215 can efficiently support.