With the VIX @ 13.12, M6 @ 15.38 and N6 @ 17.60 the contango is well above normal. If VIX stays flat a $75 SVXY by the end of summer is possible. Five things which could spoil this scenario:
1. FED raises rates while economic data reverts to 1st qtr levels
2. BREXIT - looks like it will be defeated but a major terror attack could change this
3. Oil prices drop as glut is taken off hold - need oil to stay over $40
4. S&P once again bounces off 2100 and 2025 support fails - with GAAP PE so high this is possible
5. China has hard landing
The S&P has formed an almost picture perfect "head & shoulders" reversal point with the only thing missing is the piercing of the neck line support preferably on strong volume. If this occurs Monday, which I think is probable, the upside potential on VXX is huge! If the above occurs I'm going to also buy UVXY and sell SVXY calls.