Volatility battling higher

With the main indexes closing lower, the VIX managed a moderately significant gain, closing +7.4%  @ 16.60 (opening spike high of 17.49) - the highest close in four weeks. Despite the trend, and the uncertainty about a US Govt' shutdown, VIX 20s look unlikely in the immediate term.


VIX'60min

VIX'daily3

Summary

The VIX was arguably the most interesting aspect of the market to watch today.

The opening hourly candle was a classic black-fail one, and indeed, that was a clear early warning that equities would eventually battle back higher into the afternoon.

Despite renewed equity weakness in the closing hour, the daily closing VIX candle was itself also a black-fail candle, and frankly, that should really concern those equity bears hoping for much lower levels across this week.

Considering the style of price action across the past few weeks..and months, I simply can't envision the VIX above the key 20 threshold in the near term.

On the flip side, equity bulls can not be confident until we see a few daily closes in the sp'1710/20s.

As ever....we'll know soon enough.
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more later..on the indexes

Closing Brief

The main indexes closed somewhat lower, with the sp -10pts @ 1681. The two leaders - Trans/R2K, remain stronger, and declined by just -0.2% and -0.1% respectively. Near term trend remains weak, but once the shutdown has come and gone..the bigger upward trend will likely resume.


sp'60min

Summary

Well, congrats to those on the short side from last Friday...with two good opportunities today.. either an exit at the open..or later into the close.

Today was the 7th daily decline in the past 8 trading days.

Certainly, its been a fair while since we'd seen this consistent (if very minor) weakness.

..and that..concludes Q3.
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the usual bits and pieces across the evening...

3pm update - greater risk of upside...than downside

Today is day'8 of a down cycle that began with the Thursday morning high of sp'1729, and during this whole move lower, the bears have entirely failed to display any downside power. Even this mornings declines have largely evaporated..and the VIX is actually in danger of closing red.


sp'60min

vix'60min

Summary

It is a tricky closing hour to call. Certainly, the broader trend is still lower (if slowly), but a simple look at the hourly MACD (blue bar histogram) cycle, and there is very high risk of a snap higher.

Interesting price action in UAL, STX, and many of the miners.

updates..into the close...


3.07pm.. new Qe-pomo schedule out.. see NY Fed

Bears should certainly be mindful of the sig' QE tomorrow and Wednesday.


3.10pm.. despite the past 8 days of weakness, just consider that the 'old leader' is still a significant 5.5% higher on the month.

The broader up trend....continues
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3.20pm.. despite another wave of weakness in the sp', the two leaders  - Trans/R2K, are holding up pretty well, and certainly not warning of major downside.

Equity bears..and I realise there are a fair few out there today...should be desperate to break the opening low of 1674.99. A daily close at the lows..would indeed be bearish for tomorrow, and bode for a move to the 1660s..which some are suggesting.