The Gap Fill Objective was Met, I told ya so
Theoretically VXX shares can trade down greater than 90%. And if history is any precedent that has happened over the course of the 7-8 years this vehicle has been trading. What this chart demonstrates is the oversold nature in which volatility has been suppressed so much, 39.72% is a real plummet in our book, so it might be overdue for a bounce
This analog also shows that the price declines greater than 35% were often followed by price gains between 25 and 45%
The Four Hour Chart
The measured move has already been nearly completed. One of the most classic topping patterns is the head and shoulders top, and on this time frame it can be seen very clearly. On the left edge from last Friday VXX surged and left a major imbalance in price, and price had 9 days before finally filling it. Specifically, the gap spanned between 33.15 and 34.25 on last Friday and was closed in the overnight drop.
When we captured this frame
It is still very early yet, but the bounce is in play! After falling to 32.55, VXX begane to make its way out of the green box, the location of the box anyway was in a high demand price range, and although we admit it can break the bottom of these levels at 32.50 and below it still acted as a support beam, and could drive it higher into tomorrow and next week: to 33, 34, 35, etc.
There are also very similar patterns with CBOE-S&P500 Vix too
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