Volatility still retracing lower

It was a pretty messy morning for the VIX, opening a touch lower, but then seeing a minor snap higher to 16, but as expected, the market battled back to the upside. VIX closed -3.9% @ 14.39. It would seem VIX 13s are viable Tuesday, before an attempt to break 20 this Friday.


VIX'60min

VIX'daily3

Summary

Today went broadly as expected, especially for the VIX.

With the indexes faking out the bears in mid-morning, the VIX was teasingly spiking higher to 16.00..only to then fail..and slipping moderately net lower by the close.

Best guess remains, VIX 13s 'sometime' Tuesday, along with sp'1570s.
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I hold to my mid-term outlook, which is seeking a VIX daily - and possibly weekly close above the key 20 threshold. If the latter is achieved, then the VIX upper 20s..even 30s are viable in late May.

More later..on the indexes.

Closing Brief

The main indexes all closed moderately higher, after what was a pretty choppy morning. Precious metals and Oil held significant gains, the fractionally lower USD no doubt helped to maintain upside momentum. Near term target remains sp'1570s, with VIX briefly in the 13s.


sp'60min

Summary

I'm holding to the original outlook from last week.

A wave'2 ABC bounce, which now looks to conclude tomorrow - after 3 trading days, relative to wave'1 down which took 5-6 days (depending on how you like to count it).

What is clear, those looking for a H/S formation need to see NO daily closes >1575.
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*I remain on the sidelines, and will be on standby from the Tuesday open for a major re-short.

Its possible we might gap into the mid-1570s, but - like today, put in a fail, with black candles on the hourly index charts.

We shall see.
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The usual bits and pieces to wrap up the day, across the evening.

3pm update - algo bots gone wild

After the early chop in the morning, its turned into a quiet trading day, and that means the algo-bots are back in control again..which makes further melt higher into the close quite likely. A close just shy of the 1570s is viable, with VIX possibly in the 13s.


sp'60min

vix'60min

Summary

For the bears, this is turning out to be something of an ugly Monday. This time last week, bears were revelling in some very strong downside.

Overall, it does look like the ABC 'wave 2 bounce' idea is still viable. Unless we get a daily close >1575, I'll be holding to that scenario.
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*I sit on the sidelines, and will be on standby for a major short of the indexes - and Oil, which may be as early as Tuesday morning, probably around 11am.

2pm update - still battling higher

Market is stuck just under sp'1560, but bears should beware of a possible close in the mid 1560s if the algo-bots are in the mood. Precious metals and Oil are holding gains, and look set to build a little more into Tuesday.


sp'60min

Summary

Its quiet out there in market land..and thus the algo-bots should be more in control today than any of last week.

No reason why we won't close a little higher, the only issue is whether we gap higher tomorrow into the 1570s..or have to battle higher across the day to reach it.
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2.22pm..  algo-bots in command, doing a stop run of the sp'1560 people.

VIX on the slide..maybe the 13s are briefly viable tomorrow morning.

VIX high 13s now look kinda likely, considering the algo-bots are back in control of the indexes

it also looks that this morning was indeed the B' wave.

So we're NOW in the C' wave, which could easily be complete by late tuesday morning.


2.41pm..urghh..poor bears, algo-bots gone wild, major short-stop run

1pm update - on schedule

Mr Market remains on the slightly bullish side. Target remains the sp'1570s, with VIX in the 14s..the latter of which is already 14.76. Precious metals and Oil are building on gains. Bears...need to remain patient!


sp'60min

Summary

Suffice to say, its looking on schedule.

*I remain on the sidelines, seeking an index and Oil short sometime tomorrow.
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12pm update - C wave underway ?

Mr Market is battling back, and a moderate rally into the close looks very viable. Those bears getting overly excited about those earlier declines could be real annoyed by early Tuesday. Metals and oil are holding reasonable gains, VIX is cooling down, set to go red.


sp'60min

Summary

I've added a channel on the hourly chart, maybe that will be useful for Wed, when bears really should be seeking some kind of initial weakness.

First obvious downside target is a break <1536, which is certainly viable by Friday, even if we are in the 1570s tomorrow.

*re: Friday GDP. I've read the story on some 'intangibles' of 500bn to be added to GDP. I think its due to be added for Q2 data in July,  Regardless, the market should start to re-price in the underlying weakness out there.


VIX update, from Mr T.



I think the buyer of the 'call stupid' was..stupid for buying a day early. They could probably get the VIX in the 14s tomorrow.

The patient bear..is (usually) a less stupid bear.

11am update - B wave...probably

A somewhat choppy start to the week, but it does seem likely that we're just seeing a small B wave play out - as part of a wave'2 ABC bounce. Best guess remains that it will complete by late Tuesday. Very obvious short-stop levels are the low 1570s or 1597.


sp'60min

Summary

Hard to know if this B' wave is already done. Might be.

What I don't expect is a any consistant downside, certainly not taking out the recent 1536 low.
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Seeking upside into late tomorrow...sp'1570s, with VIX 14s.
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I still like Oil as a short for overnight Tuesday...

USO 60min

Seeking the low 32s late tomorrow.

10am update - opening gains fail

Market opened a little higher, but we're seeing those gains fail, with the indexes now red. Precious metals and Oil are still higher, but even they are well below their pre-market highs. Seeking renewed strength late in the day, with sp'1570s by late Tuesday.


sp'60min

VIX'60min

Summary

Looks like an A' wave is done. B could take rest of today, not that I expect a close <1550. With a C wave complete by late Tuesday. I suppose it could drag into early Wednesday.
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VIX was the tell at the open, whilst the indexes opened higher, VIX was only a fraction lower, rather than a typical -5% or so.

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*I remain sitting back until Tuesday.

UPDATE 10.15am.. a little flash lower in the GOOG.

There were trades going through at those levels...ugly for the ones who kicked, only to see it jump back up.

10.43am..baring a break of the 1536 low, we're still headed for those 1570s.

Bears..need to remain patient and not get over excited what is probably a B' wave lower.

Pre-Market Brief

Good morning. Futures have cooled off a little from their peak overnight gains. The sp is +4pts, and set to open around 1559/60. Precious metals are significantly higher, Oil is +0.5%, with the USD a touch higher. Higher levels in the sp'1570s seem more likely tomorrow.


sp'60min

sp'daily5

Summary

Well, here we go again, another week.

Certainly, we're not opening lower, so those bears holding short across the weekend are going to be starting the week in a bad mood.

Its always difficult to delineate the small index waves, but I'm generally seeking an ABC 'wave 2 bounce'. Maybe we'll get the B wave down, later in the day?
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re: the metals. Opening gains have frequently failed to hold in recent days, so don't be surprised if Gold/Silver close red. There appears to be a small chance of an all out collapse wave, lead by none other than Dr. Copper. More on that later tonight, maybe.
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*I remain on the sidelines, seeking a full re-short, when the sp'1570s, with VIX 14/13s.

UPDATE 9.04am..indexes still cooling down, and we might even open a touch red.

Oil and the precious metals still holding gains though.
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