For short term traders and short term charts, VXXB upside divergence on March 26/27 15 minute charts clearly shows us that the SPY would do the opposite and send markets down until the technical picture starts to stall and that’s the end of the move. Then you can spend the rest of the day counting the money you made.
SPY 278 puts at 10.30am went from 2 cents to 81 cents in a few hours.
SPY 281.5 & 281 puts were up about 500% from 11am to 11:35am Eastern time today just based on short term charts on an expiration day!
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The Options Hunter nightly update on Monday February 4, 2019 explores some intraday SPY divergences that yielded hundreds of percent gains in a relatively low volatility day.
Dale covers some of the longer term divergences and option trades on stocks like AMZN.
Note how WYNN had another 30 min up divergence late Monday to add fuel to an already divergent daily chart! That’s how you successfully trade a new entry to an existing pattern! Low time frames form “another” divergence in the same direction as the higher time frames!
In Friday's update Dale explains the SPY long term weakness to downside is still in place but in lower timeframes there was room for moves in either direction. The short term timeframes Thursday clearly indicated the upside potential on SPY that came about. Even during the rally on Friday there were short term trades to downside on SPY that yielded 100% gains.
In this update from Dale Wheatley he discusses the upside divergence taking place in SPY and others and then explores the available out of the money options. Compared to the huge gains available earlier in the week on puts options, spectacular gains were thin on the ground. 2 to 4 times your money only.
Some VXX downside divergence in latter part of Friday but not overly clear. GS had decent daily divergences to the upside still on going the XLF had a series of 60 minute divergences in play earlier in the week
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