This appears to be an objective time to start scaling back into the /VIX or VIXY trade, especially as an indirect hedge if taking any index longs home over the weekend. The previous two 120-minute charts of /VIX ($VIX futures, March contract so the price levels at the same reaction/support/resistance levels are different) posted followed by the updated 120-minute chart below. We essentially milked every cent of that 50% run off the divergent low, reversed it there & milked a good part of this (so far) 20%+ pullback reversing there (personally, I covered a week or so ago but starting to scale back in long today), and will continue to add to that position on either weakness or strength, until & unless something convinces me otherwise next week.
VIX-120m-Feb-6th
VIX 120m March 10th
VIX 120m March 21st
Previous (Jan 30th, March 10th, & March 12th) & updated daily charts of VIXY ($VIX near-term futures ETF) for those preferring to trade ETFs in lieu of futures below.
VIXY daily Jan 30th
VIXY daily March 10th
VIXY daily March 12th
VIXY daily March 21st
To reiterate, my preference is to start scaling back into the $VIX long here either as a pure-play and/or a hedge to any index long (or closely related, e.g.- Mag 8 stocks) positions. I will assess the charts next week to determine whether to add or subtract (close out/remove hedge) this $VIX long position.
I also feel that while the $VIX certainly can & likely will continue to fall next week, should the stock market rally, it appears that the R/R is no longer favorable for shorting or remaining short the $VIX as it is getting close to the low-end of its 2024-2025 range.