Volatility - smashed lower...again

With the Greek election out of the way, the option writers are happier to sell calls/puts for much lower prices. Insurance for a major market decline just got a lot cheaper today, VIX slipped over 13% !

On the VIX daily chart you can especially see clearly the break into the 18s today confirmed the H/S formation. There are probably at least 2 more down days for the VIX, possibly 4 if we somehow keep rallying on the indexes to 1380/90 by Friday.


VIX, 60min

VIX, daily, rainbow

VIX, weekly

Summary

I did not think we'd hit 18s today, so my new target low for this cycle will be 16/15 - on an index spike high of 1360/70 this Wednesday.

The weekly cycle looks exactly like July'2011, and most should remember what happened to the VIX across the following 3-4 weeks.

Lets be clear, VIX 40s...are still very possible this coming July.

Closing Brief

Market closed mixed across the various indexes. Tech was strongest, closingg up 0.75% or so, dow marginally red, but both IWM and SP' closed marginally higher.

Considering the opening losses of around 0.5%, today was most certainly another reasonable day for the bulls. Lets check those hourly cycles...


IWM

Dow

Sp'

Summary

Today was day'11 of this up cycle, and everything remains on track for sp'1350/60 by the Wednesday FOMC decision.

More later...looking at the VIX, daily cycles, and the bigger monthly outlook

3pm update - holding up into the close?

Those bears who did not take the opportunity to close out at the open will be getting real mad about now.

Its still kinda quiet trading though, so I'll take the opportunity to highlight this....


sp' daily, fib levels

Summary

I think the above chart is one of the clearest there is that summarises whats going on right now. Whether you subscribe to the idea that Fibonacci levels are important or not, you can still see that we remain in what is a strong wave'2.

A wave'2 that by definition should soon put in a lower high <1422, rollover, and then break below the recent 1266 low.

Target remains 1350/60....and then 1150/00   ;)

More after the close!