Volatility fails to hold opening gains

With the indexes seeing a fast decline in the opening hour, the VIX spiked 8% higher - back into the high 16s. Yet the bulls quickly turned it around, the VIX failed to hold all of its gains, closing slightly lower, -1% @ 15.36


VIX'60min

VIX'daily3

VIX'weekly

Summary

The VIX jumped into the close yesterday, and this mornings follow through of a further 8% was kinda interesting, but the fact those gains failed soquickly was a very strong signal this market is not going any lower in the near term.

The weekly chart is still kinda bullish, having gained over 8% across this week.  Yet, from a momentum cycle perspective, the bulls could justifiably say its merely a failed spike...which it is.


No VIX 20s for at least a month or two

My outlook is for the sp' to climb to 1550/60 - no later than end April, and that very likely means the VIX will decline back into the 12s..if not the 11s. In fact, if the media - and the market gets a touch of bullish hysteria in March/April..perhaps we will briefly see single digit VIX.

...and that would make for a very nice multi-year cyclical VIX floor.

--
more later..on the indexes.

Closing Brief

A choppy start to the month..a choppy start to end the week. Some pretty significant intra-day swings, from 1514 to 1501..then 1520 to 1513. Highlight of the week was Mondays brief spike in the VIX to the 19s. It will probably be 6-8 weeks until we're back at those levels.


sp'60min

Summary

Another week ends, and it was certainly at least not boring!

All things considered, it looks like we're getting another wave higher to 1550/60. So..the bears need to be patient until we're well into the spring.

The usual things to wrap up the week across the evening.

Have a good weekend!
--
*next main posting, late Saturday, on the World Indexes

3pm update - choppy close to the week

Market remains a real mess today, although for day traders, this sort of price action is no doubt a good thing. Dollar will close the week will some good gains, whilst Oil and Gold remain under pressure.


sp'60min

Summary

So long as the bulls can hold this market above 1501, there really is nothing for them to be concerned about.

I'm sitting it out across the weekend. I might take a small long position next Monday, and try to ride this nonsense to around 1550 by mid-March.

Regardless, its been an interesting week.

back after the close