Samwise Quick Reference Handbook
To streamline our daily blogs and conserve space, we’ve organized key resources into a convenient, collapsible dropdown menu below. A sort of Quick Reference Handbook if you will -- as our friends in aviation might call it. By clicking the menu below, you’ll have qu...
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Hi Sam,
Question about this statement:
How does this work at the bottom of corrections when the VIX has already sky rocketed? How would you discern a significant increase in volatility in an already very high volatility environment?
Thanks!
Should we be looking to the Bollinger Bands on the VIX daily chart and on the look out for significant breaks above the upper band?
VIX over 40 is a good indicator for the bottom, but there’s also the NYMO indicator when it reaches -100 is the best one. Also daily RSI at 29 or below.
It’s a big relative shift that you want to look out for. For example, in the April correction, we went from typical correction-level selling to a massive jump to 5-6-7% down days. That’s when you know things have shifted into a much higher volatility regime.
We saw the same thing in Covid and during the financial crisis. Anytime you haver a huge jump to increased volatility, that’s an indication.
Here, the market just went from 0.2% up/down days to 1.5% up/down days. Look at the last four trading sessions. We haven’t seen a session that didn’t have the market swinging at least 1.5-2% up/down. That’s a shift to higher volatility.
Look at our September 2026 puts we’re trying to buy. At even $606 a share, they haven’t reached $16.
WE bought them at $16.10 when the QQQ was at $599. It’s now at $606 and they’re at $16.30. They’re higher in value with the QQQ 7-points higher than when we bought them.
Anyway, that shift in volatility is typically trend changing. The damage is sort of done here.
Once it breaks the 590, arriving at first downside target of 590-23 = 567 is based on which technical principle? I just newly subscribed so trying to learn
thats how Head and shoulders pattern works. its the distance from neckline to the top of head and the same distance on downside for the target. i recommend google that and you can get a clear understanding.
Hello Sam
What about major gap ?
Best
Karl
Hi Sam,
Question about
Do we have general % ranges for correction legs and rebounds, similar to rally segment %s? Mainly asking for educational purposes, to understand the target $ you’re outlining here. I remember us talking about how corrections tend to have two legs so wanted to get a better picture on what to expect with the upcoming correction.
Thanks!
Sam, are the NVDA puts for next week cooked at this point or do they still have some value if the market pulls back?
It’s still not clear to me why the Oct 17 put weren’t sold this am, or last Friday?
I am glad I sold them on Friday at 0.21, I wanted to at least get some value while there was a chance
Hey Sam, I’m wondering what you think about all this news pointing out NVDA as an infinite money glitch (as per the Bloomberg article: Bloomberg: OpenAI, Nvidia Fuel $1 Trillion AI Market With Web of Circular Deals : r/singularity), and I’m wondering if you have any concerns as to whether or not this could fuel bearish forces against the current stock valuation? Or long term, NVDA is still one of the most solid buys there is?
Also wondering on if you have plans and price targets to buy more of the stock once the inevitable pull back occurs?
“Market can remain irrational longer than you can remain solvent.” What are the durations of previous complex tops before they start sustaining a correction (if at all)? Are we talking on the order of 2-3 weeks or something like 6-8 weeks or what?
if we look at most recent topping processes, we saw one in November of 2021 where we saw QQQ make repeated attempts at 400 level before ultimately dropping for a large correction in January 2022 to indicate the start of the bear market. We saw a similar thing with December 2024 and eventually we got a larger correction starting in Feb 2025. However in that topping process there were draw downs equivalent to levels that Sam is referring to i.e. 567 on QQQ in todays terms. A high probability trade is allocating to shorts leaps if by December or January we are still trading at 600 without having tested lower levels by way of a larger correction to low 500s.
So I assume “high vol topping” is much shorter in duration as compared to consolidation top?
is it something like the july 2024 peak,
the 3 days price movement right after the 2% sell-off?
QQQ gap up
QQQ nhod ramping just over 1% off ATH
VIX just under 20 key level
QQQ nhod
The tough thing is those 31 oct put spreads could print the hardest if QQQ corrects but it essentially needs to happen NOW.