Trin and Vix Trends
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If you are a trader, particularly trading the ES, or spoos, you know how the intraday market often takes you right out of a trade executed at the wrong time. You expected a short trade and you were right, but you got in too early. A common problem for all traders. What if there was a way to know if the market was moving in your favor before you executed? We think there is. And it is primarily dependent on reading both the trin and the vix. Consider this premise. If there was an effective way to know whether a trend has started on the trin, would it necessarily mean the same trend had started on the vix? Not at all. Unless both the trin and vix have ended an existing trend, trading against either one could easily result in losses. We have developed a time tested method for determining when a trend exists as well as a means for determining targets for when it will end. And we have developed a complete consistently profitable strategy around it. We are sharing our logic here for the first time anywhere. When using a 1 minute chart, the trin and vix moves in small increments measured to the 2nd decimal point (1/100th). To illustrate the idea we will just talk about the trin although the basic idea applies also to the vix. The first issue, however, is to determine what part of the bar you are looking at. We believe the high of the spoos (A) corresponds with the low of the trin and vix (A). The low of the spoos (B) corresponds with the high of the trin and vix (B). We pay no attention to the open or close.
Also forget all the preconceived ideas about what is bullish or bearish. The trin can be at 3.4 and move down to 1.9 and you can see a heck of a rally in the process. Presuming that the trin has established a pivot in the opposite direction, if a trend is being established look for the following. The trin should move from the current 1/10th decimal point completely beyond the next 1/10 decimal point. ei current reading 1.24 and going down. To be trending, the trin must move in to 1.10 at least. Trin must not have been greater 1.24 when you start tracking it. Also, if the trin moves higher than 1.24, the up trend probably has not started and you need to keep watching. But once it starts to move, it WILL move in to the next 1/10 decimal point and likely will continue in to the 1.0X or .9X or more. Thus the trend has started and trading with the trend will produce successful trades.
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