For a derivative that is based on the CBOE’s Volatility Index, commonly referred to as the Fear Index, the iPath S&P 500 VIX ST Futures ETN (NYSE: VXX) is moving in a surprisingly narrow range these last 5 weeks, with the ETN showing a relatively small amount of volatility.

In fact, VXX remains close to the bottom of Year-to-Date levels, as may be seen in this chart, ending the week at $15.21, not far off the year’s low of $14.64. That’s the support level for VXX now, and should serve as the likely bottom for any risk-to-reward calculation made by traders looking for a good place to enter a bullish trade.

Here’s a good place to recall that the VXX, which offers inverse exposure to the broad S&P 500 basket of stocks, basically goes up when the equity market goes down, and vice-versa of course. So a bullish VXX play is a bet that equities are prepping for a bearish move.

VXX has seen more dojis in the last month than almost the rest of the year combined, reflecting the lack of commitment by either the bears or the bulls. There is uncertainty in equities, but apparently fear has not permeated investor mentality to any great degree, otherwise we’d be seeing the VXX traveling closer to the $20-30 range, as we saw in January and February of this year.

So we’ve been advocating for swing trades on the VXX as it hits the strong level of support of $14.64. And those trades, while not raking in profits, remain sound ones, as the upside of such a trade remains relatively higher than the downside.

The sideways range for VXX established a little more than a month ago is framed out by that $14.64 support level and $17.50 resistance level, also serving as the Over/Under for the ETN.

The range is currently about the width of the Bollinger Bands, which are contracting pretty tightly for that indicator. Any extended period within that range usually results in a sharp directional move. Again, in this case, the move has more room to go up than it does down, so a break from the current bands is more likely lean towards the bulls.

The next level of resistance is $19.35, which could easily come into play with a bearish drop of 5% in the broader market.

VXX PayDayCycle Status is now -1, as today’s close ended below Thursday’s, and follows the end of a 3-day bullish PayDayCycle. The single red bar means there is no PayDayCycle established at this time.

PayDayCycles are 4-8 day trends in stocks that help people swing trade. To learn more about PayDayCycles make sure to grab the free Swing Trading Class on the right sidebar.

The MACD ended the week in the red, following 5 straight days of bullish momentum. It remains above the zero line, though the small bars are indicative of lack of any strong trend.

Bottom line: Same as last week, a bullish swing trade opportunity remains in play, especially in light of the current risk-to-reward on the trade, offering a lot of upside potential vs. a smaller amount of downside risk.