Velocityshares Daily 2X Vix Medium Term (TVIZ)

[gldtimer]

Location and Path...if they're is one.

The market is communicating to be in a high growth, low inflation (deflation) environment which favors LQD as the bond investment of choice.

Beginning July of this year, the market began to move along what I call path 'a' (one of 16 paths). This means LQD was not the exclusive bond investment but also JNK. This movement is the market suggesting that inflation exceptions are increasing.

The degree however is muted, being only 1/4 along the 'a' path. Now if inflation expectations are reduced the market will move along the 'b' path back to LQD exclusively.

Both LQD and JNK are supportive of risk on which favors rising equity prices and lower vol.

If the market expected lower growth it would be on the 'c' path to IEF or economic winter. This however is not the case. There is a time to every season. This is not the season to short the market or play pos vol...but then you know that anyway.