New BloodHound VIX Template

In this video we go over the new template available for Bloodhound user of ZoneTraderPro.

Installation and Use of the Indicator

The purpose of this template is not to determine a top or bottom.  It is specifically designed so that it will not identify a top or bottom.  It is designed to determine trend and give high probability trade entries using divergences on the SPY.  Read more about that HERE.

There are 2 files and each file has several templates to choose from. There a different file for the VIX and VIX9D.  Test each of the templates and see what you like.

Here is why there are two files.  The VIX9D represents options expiring over the next 9 days.  That will also include options that are only being day traded.  The purpose of the template is to determine trend.  At the market open, there is no trend.  Keep that in mind.  It is extremely common to have options expire in the VIX9D, resulting in gaps on the open.

The VIX option template seam to preform better at the open than the VIX9D, because it is less susceptible to big movements because of options expiring the day before.  

There is a significant amount of options that are day traded on expiration day.  So this creates a skew at the open.

Also, by having 2 different files with fewer BloodHound solvers, there are less math computations and they seam to load faster.

 

VIX and VIX9D Examples

Vix Example
Vix Example at the Open

Here is the ES chart with the VIX template on the open.  The VIX chart is used at the open because it is less sensitive to options that may have expired the day before.

Vix9d Example
VIX9D Example During Trading Day

Here is the SPY chart with the VIX9D template.  The VIX9D can be used once the day has started.   It may provide a clearer picture of the volatility because options positions are being initiated and traded that may be expiring in a short period of time. 

ES Example

Here is the ES chart with the VIX9D template.  Here is what is interesting.  Notice how in a 3-4 point pullback, that the indicator doesn’t flip.  That could be important.

Installation

I will send you two files in Skype.  One file is a license checker which is installed using the NinjaTrader Control Panel.

Download the VIX Files

Right Click and Save As the zip file containing the BloodHound Templates.

These files are placed in this location when they are unzipped.

bhlocation
import

The next files are the SharkIndicators template files.  You need to place these in the BloodHound folder once they are unzipped.  

The picture on the right shows that path.

Kinetick

The data we need for this template to work is not provided by NinjaTrader Continuum.  You are going to need an additional data feed. I recommend and use Kinetick.

Click the Kinetick image and you will be taken to Kinetick.  When you get to the site and sign up, you are going to need to need the following options.

  • Basic Service $65
  • CBOE Indexes    $7
  • NYSE Non-Pro Exchange Fee     $7
  • GLOBEX COMBO Level I Non-Pro for $5

 

kinetick
NOTE:  GLOBEX COMBO can only be added AFTER you have signed up for Kinetick. The link for that is found here, or found on Kinetick website Help Menu
 
Choose the All 4 Level 1 Globex option for $5.

Very Important

You must connect to Kinetick first when you start NinjaTrader.

Adding the VIX9D Symbol - VERY IMPORTANT

Go the TOOLS Menu and choose INSTRUMENTS and click ADD

instruments

The template is using the VIX9D symbol.  This  represents the VIX options that will expire in the next 9 days.  SpotGamma believes it is more of a leading indicator than the regular $VIX symbol. 

Name the master instrument VIX9D 

The instrument type is INDEX 

You need to put the name of the exchange.  Put CBOE.

You need to tell Kinetick where to find it.  VIX9D.XO

Instrument

In order to use this we need to use the instrument manager to add it as a symbol.  Create a new instrument list and name it anything you want.  Then add the VIX9D to the instrument list.

Instrument List

Click ADD and create a new list. Name it anything you like. Then click ADD on the Instruments side, and add the VIX9D. The SPY and VXX are not necessary to add. Only VIX9D.

instrumentLists

Monitoring VIX9D

I keep both a 1 minute VIX9D and 5 minute chart of the VIX on my desktop.  It really doesn’t have to be much bigger than the picture on the right.  

As VIX falls, as in the example, long trades are favored and short trades are not.

I keep it hovering over the left side of a bigger chart to save space.  Toggling the ALWAYS ON TOP property will keep it always visible.

As VIX rises, as in the example, long trades are going to be more difficult and short trades are favored.

Using The Template at the Open

The purpose of this template is to determine trends identified using the VIX.  This is not an indicator that calls tops or bottoms.  The way it is designed, it WILL NOT call tops or bottoms.

The templates become more difficult to use on the open and you MUST monitor the 1 and 5 minutes charts.

Because options may have expired at the previous close, the VIX9D may open away from the close and have a gap up or gap down.

In this example, we had a bearish gap up, and the 5 minute bar continued to rise.  Had it been falling, your decisions are more difficult and likely long trades may have been favored and working.

The VIX option templates seam to preform better at the open than the VIX9D, because it is less susceptible to big movements because of options expiring the day before.  There is a significant amount of options that are day traded on expiration day.  So this creates a skew at the open.

NinjaTrader Instrument Manager for Vix Setup

In this video we look at adding the VIX9D symbol to NinjaTrader and setup of the BloodHound Charts