By Lawrence G. McMillan
The feature article details a shortterm seasonal systems that lasts for just one week. It actually pertains to the week that is just ending, and we outlined the system in last week’s Hotline, using it to hold onto SPY puts. The full explanation of the system is in this issue, and we will employ this system again in the future. There is an update of the “modified Bollinger Bands” sell signal on page 3.
Also on page 3 is an article detailing two new functional changes in the derivatives markets: 1) $VIX futures will be trading 24 hours a day during weekdays, and 2) $SPX will launch “end-of-the-month” p.m. options.
On page 6, we detail the $VIX-based system that called the “mini- Crash” of 50 $SPX points in February, 2007. This is the first time since then that the system is potentially active. A recommendation is made as well. An expanded explanation of the Diagonal Calendar Spread strategy that we often use for earnings plays, is present on page 7.
On page 9, there is a $VIX futures spread, and a gold (GLD) position. On page 12, another $VIX/SPY put hedge is recommended.
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