Volatility lower again

With the main indexes closing a little higher, the VIX once again slipped, falling 2% into the high 13s.


VIX'60min

VIX'daily

Summary

Even VIX 16 looks a long way up right now. This is pure craziness considering the unstable month of October is ahead.

From a MACD cycle perspective, we're certainly due a good up move in the VIX, but right now it won't be until at least the middle of next week until we go positive cycle.

The bears can at least claim that we've not broken the mid August low yet..despite QE3.

More later.

Closing Brief

So we're back to the low volume melt again, sigh.


dow'60min

Sp'60min

Trans'60min

Summary

A very dull day, but we did appear to show a little weakness in the closing few minutes, but still..net gains for the main indexes.

I can only hope tomorrow is more entertainment, urghh

More later

3pm update - messy

We're experiencing low volume mess. I suppose you could count a 5 wave moev since we snapped higher Sept'6, with us being in the fifth higher. I don't much like to count this nonsense though lately, its all mostly noise.

The daily underlying cycle is still suggestive of a rollover, but really, its IS a messy near term outlook.


sp'60min

vix'60min

Summary

Things are even a little more mixed  than I was looking for today,

Its been around 3 months since we had a proper down day, and frankly, it sure doesn't feel like one is imminent. Its not so much 'calm before the storm', as just...the boring doldrums.

AAPL hit $703s earlier, clearly the QE is working................./s

More after the close

12pm update - tiresome

Its starting to real dull again, even more so than the previous two days. Considering the daily cycle, I do not expect new highs, although the dow is getting real close to taking out the Friday morning opening spike.


sp'60min

vix'60min

Summary

Dull. What else needs to be said?

VIX is merely decaying away to nothing again
--

There is a little chatter of 'busy trading' with Friday, since its a quad-opex, and there is re balancing of the Sp -and maybe other indexes too. As it is, its all dull.

First target remains 1450, but right now that sure ain't viable until late tomorrow

back at 3pm.

10am update - Weak

There is a smell of weakness in the market so far today. The transports is again getting slammed lower, and is in danger of losing the big 5k level.  Its amazing that the dow/sp' seem to completely be ignoring the action in the transports.

The VIX is a touch lower, I'd certainly look for a marginally higher VIX close.


sp'60min

Trans'60min

sp'daily5

Summary

I'd expect a few hours of sideways churn..before the next opportunity of downside. First target is a very obvious 1450. Bears really need to break below that by the close of Thursday, otherwise I fear we could start battling higher again to yet another high.

So, lets see if we can break 1450 - that won't be easy today, but a daily close <1450, will then open up 1440/30 for what will be a choppy quad-witchy opex Friday.

Back at 12pm.

A red flag for October?

Those doomer bears who are still looking for Autumnal red flags need only look to the transportation index. The transports has had a rough week so far, declining 2.5% to 5083. Yet, - as has been the case since February, only with a monthly close <5000, will there be a genuine real warning of possible underlying weakness for the wider market, and indeed, the economy.


Trans' monthly, rainbow

trans, weekly

Summary

We are seeing a pretty strong reversal in the weekly chart, even if we decline no further this week, and close at present levels, it would make for an preliminary warning.

The monthly chart has been mixed so far this month. We opened September with a red candle, but that has flicked to blue..and even green with the announcement of QE3.

Yet with two days of strong declines, the tranny is now sporting a blue candle on the rainbow chart, and we're just 1.5% away from breaking the 5000 level.

If we can close September under 5000, I think that will most definitely count as the first red flag, and indeed, it would be confirmation of the red candle we saw in August.
--

I remain short, seeking an exit somewhere around sp'1440/30 within the next 2-4 trading days. I don't think we can take out the previous cycle low of 1397 in this cycle, but it will be paramount for the bears to seek a lower high <1474 in the next multi-day up cycle.

Goodnight from London

Daily Index Cycle update

A dull day for the main market, although the transports continues to show very significant weakness. First target is a daily close <1450, and then 1440/30 within 3-5 trading days.

It would appear very unlikely we can break below the recent cycle low of 1397.


Sp'daily5

Transports

Summary

The main market remains flat, although arguably a top is in at sp'1474. The transports remains remarkably weak, and today again put in a very strong decline of 1.1%.

Transports is set to go negative cycle on the MACD either late tomorrow or Thursday. So, look for a stronger move to the downside then. Will the dow/SP' finally play catch up, and snap lower then?

With the QE3 decision done, things do remain a little strange. After all, what now? Are we literally waiting for the clown networks to lead the way with talk of 'when will the fed increase monthly purchases?'. Considering the underlying economy, I'd expect the Fed to ramp purchases to at least $125/150bn by the end of Q1 2013.

Once again, that just makes me wonder about the metals, not least with the dollar broadling declining.

A little more later.