VXXB dominated by bears dragging the market lower throughout the day
iPath Series B S&P 500 VIX Short-Term Futures ETN (VXXB) Technical Analysis Report for Mar 21, 2019 | by Techniquant Editorial Team
VXXB ended Thursday at 28.78 losing $0.38 (-1.3%). The bears were in full control today, moving the market lower throughout the whole session. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (VXXB as at Mar 21, 2019):
Thursday's trading range has been $1.14 (3.85%), that's slightly below the last trading month's daily average range of $1.20. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently just the same than usual for VXXB. Prices continued to consolidate within a tight trading range between 28.12 and 29.59 where it has been caught now for the whole last trading week.
One bearish candlestick pattern matches today's price action, the Black Candle. The last time a Black Candle showed up on March 14th, VXXB lost -1.85% on the following trading day.
Prices are trading close to the key technical resistance level at 29.56 (R1). After having been unable to move above 29.51 in the prior session, the ETF ran into sellers again around the same price level today, missing to move higher than 29.59.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term. With its 50-day moving average crossing below its 200-day moving average, iPath Series has entered a so-called "Death Cross" for the first time since December 13, 2018. Showing increasing downward momentum in the short and medium-term the "Death Cross" is known to indicate a potential bear market on the horizon.
Selling could accelerate should prices move below the close-by swing low at 28.12 where further sell stops might get activated.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing Low" stand out. Although it is usually interpreted as neutral, it has actually shown to be bearish for iPath Series. Out of 75 times, VXXB closed lower 62.67% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 64.00% with an average market move of -1.95%.