Volatility marginally higher

With the indexes closing moderately lower, the VIX confirmed the move with very marginal gains. However, in the scheme of things, such moves remain largely noise. Until the VIX breaks back over 20, the bears can't take any index declines seriously.


VIX'60min

VIX, daily

VIX, weekly

Summary

The hourly cycle is primed for a few hours higher, but the formation is arguably a bear flag - with corresponding bullish pennants for the indexes.

So, if the market is pleased with any Tuesday earnings data, and can cope with the words of the Bernanke, the VIX could still fall back into the 16s, even 15s briefly this week.
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I still expect a VIX explosion into the mid 30s..possibly 40s sometime in August. Right now, I don't expect anything above VIX'50 this year. The 50 level is an absolutely key threshold those seeking a crash/collapse wave are going to need to keep in mind in the months ahead.

We have a very dynamic and turbulent few months ahead. With the Bernanke still to initiate QE3, All projections subject to change ;)

Closing Brief

A really choppy Monday, and the closing hour certainly was a little disappointing for the bulls. The VIX closed marginally higher, so confirming the moderate declines.


IWM (representing rus'2000)

Dow

Sp

Summary

From a MACD cycle perspective, the hourly cycle is set to go negative in around 2 trading hours - so, that would be around 11am tomorrow. It'd sync up well with the Bernanke speaking.

In the scheme of things though, today was all noise, although that is probably a good thing after last Fridays dow+200 lunacy.
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More later.

3pm update - closing hour gloomy doom

Whilst the market churns and chops around, here is something for your viewing entertainment from Bloomberg. Mr Stockman is yet another one in the mainstream who is starting to recognise that things are indeed weak in the broader economy...and that the US is indeed headed for recession.

It'll probably take another 2-3 weeks for the majority of the mainstream to again briefly awaken and realise 'ohoh..we have a problem'.




*it remains disappointing how Ms. Liu has turned into one of the more annoying cheer leaders out there on the clown networks. I suppose I shouldn't be surprised, but still.


meanwhile..back at the casino...

sp'60min

Summary

Sp'1350 looks like reasonable soft support right now, at the current up trend rate, we could be comfortably around 1365/70 by the Tuesday close.

With the Bernanke due to speak for much of tomorrow morning, Mr Market could be said to be effectively shut until he stops talking. So, maybe look for a post-Benny reaction around midday Tuesday.

More after the close