Wednesday reversal

US equity indexes closed broadly higher, sp +30pts at 2644 (intra low 2573). The two leaders - Trans/R2K, settled -0.1% and +1.3% respectively. VIX settled -4.9% at 20.06. Near term outlook offers Thursday weakness, but after today's reversal, the Monday low of 2553 arguably is just a marginally higher low - relative to Feb'9th.


sp'daily5

VIX'daily3

Summary

US equities opened significantly lower, as the mainstream was spooked by Chinese trade tariff news. However, there was a reversal almost immediately from sp'2573. By late afternoon, most indexes had built rather significant gains.

It was a mixed day for the VIX, opening in the mid 24s, but settling moderately lower, just above the key 20 threshold.

Unless we see VIX >26s, equity bears should be largely resigned that the Monday low of sp'2553 is to be treated as a marginally higher low - relative to Feb'9th. That sure doesn't mean Thurs/Friday can't see some sig' downside, but this morning's low does look pretty secure.
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Tuesday chop

US equity indexes closed significantly higher, sp +32pts at 2613. The two leaders - Trans/R2K, settled +2.0% and +1.3% respectively. VIX settled -10.7% at 21.10. Near term outlook offers a test of the Feb' low of 2532, with big target of 2470/50 zone, before climbing across earnings season.


sp'daily5

VIX'daily3

Summary

US equities opened moderately higher, but the gains were quickly eroded, with an early low of 2575. From there.. another push upward to 2619, with further chop into the close. Volatility was ground lower, with the VIX settling in the 21s. Its notable the VIX is sustainably holding above the key 20 threshold, a level the market never once saw last year.
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Germany, monthly

The economic powerhouse of the EU is still struggling, with the DAX currently -0.8% at 12002. Things would turn very bearish <11300, the 11k threshold to be decisive. The '5 wave' counters could arguably call a grand top in the German market. The obvious big target would be 8k.
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Monday break

US equity indexes closed powerfully lower, sp -58pts (2.2%) at 2581. The two leaders - Trans/R2K, settled -2.0% and -2.0% respectively. VIX settled +18.3% at 23.62. Near term outlook offers s/t capitulation within the sp'2470/50 zone. For now, a renewed push to new historic highs still seems viable into the summer.


sp'daily5

VIX'daily3

Summary

US equities opened moderately weak, and after the Dow turned briefly positive, things began to unravel. The s/t cyclical setup always favoured the equity bears, and indeed, it was a day for the bears. The break of the 200dma was decisive, and has opened the door to the last remaining 'legacy gap' of sp'2474/61. There are a few other aspects of key support in that area, not least the monthly 20MA.

Volatility was naturally on the rise, with the VIX settling in the 23s. Its notable that whilst some indexes are back to the Feb' lows, the VIX remains very subdued relative to the Feb' highs. Those seeing the Jan' equity high as a key mid/long term top, should be at least somewhat concerned.

Best guess: s/t equity weakness to the sp'2470/50 zone, which should see VIX at least in the 26s. New historic highs still look viable in early summer.

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