R2K, monthly3, fib levels
sp'weekly7a, H/S scenario
Summary
Even though the R2K saw a net daily gain of 1%, it does not in any way negate the significance of the failure this morning to hold the 1080s
When you consider the giant monthly chart, this year has seen a clear double top of 1212/1213, and now that we've broken under 1080... there is ZERO reason why we won't at least continue lower this autumn to 1000.
Meanwhile, the sp'500 is continuing to hold a red candle on the weekly 'rainbow' chart. Certainly, the outlook is bearish into next week, and it looks like we will battle lower to hit the lower weekly bollinger, along with the 200 dma, and the August low of sp'1904.
Looking ahead
Tomorrow will see a quartet of data.... monthly jobs, intl. trade, and ISM/PMI service sector.
*next QE is not until next Monday
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Back on the short side
With the Wednesday downside, and yet another lower low this morning, I waited for a bounce.. and re-shorted from sp'1948. Considering the VIX had cooled almost a full 2pts from the high of 17.98, I am pretty content with my entry.
The issue now is how will the market open tomorrow? With the jobs data, it is tricky to say, but certainly, best case would be sp'1930/25 zone. By the Friday close, it is possible we'll be trading around 1915... which would likely equate to VIX 19s.
For me, I am particularly looking at the bigger picture, which right now is turning bearish.. as especially seen in the R2K and Dow. More than anything, equity bears should be looking for a VIX weekly close above the 200MA...
... currently around 17.50.
Goodnight from London