I am paying extra close attention to volatility into June. We had several winning UVXY long trade inside 12631 throughout this year, even as the chart has cratered overall, due to being exceptionally nimble with our timing.
In terms of a potential multi-day or even multi-week swing long, though, you can see the second chart below of the volatility levered ETF washing out of late.
And yet, the actual VIX on the first chart is green today. I read into this divergence as a general lack of interest by retail traders in buying volatility, likely due to being burned so many times in recent years by doing so with these seemingly broken ETF’s.
It is worth remembering the nature of volatility: It is dead, punishing to longs, and broken until one day when it wakes up and then it isn’t, when we see massive spikes like in 2008, 2010, and even 2011.
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