Volatility smashed lower

With the main indexes soaring on hopes that Obama/Boehner will at least kick the debt ceiling can for another six weeks, market volatility has collapsed, with the VIX closing -15.9% @ 16.48. The strong up trend has been decisively broken, and a weekly VIX close in the 20s doesn't look possible.


VIX'60min

VIX'daily3

VIX'weekly

Summary

Suffice to say, a major turn lower for the VIX, as especially seen on the bigger weekly cycle.

Those bearish hopes of a key weekly VIX close in the 20s...have essentially been destroyed..for probably at least a few weeks.

The two spikes on the daily chart were something I wasn't giving enough credence to. If the weekly candle closes red - with the current spike, it'd be suggestive that equities will rally for the rest of October..and into early November.

In which case, you'd have to assume new index highs, with sp'>1729.
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more later..on the indexes

Closing Brief

The main indexes closed powerfully higher, with the sp +36pts @ 1692. The two leaders - Trans/R2K, closed with major gains of 2.3% and 2.5% respectively. With Boehner caving in yet again, Mr Market has again smashed the equity bears, and looks to offer more pain tomorrow.


sp'60min

Summary

For the bears..it was arguably the worse...if not most disappointing day of the year. The sp'1640s now look a very long way down, and considering the size of today's daily candle...follow through to the upside is very likely.

After all, the political maniacs are going to keep playing their little games..

rinse..repeat...for mid-November.

*I hold short silver overnight, and looking to drop ahead of the weekend. I'm not intending to meddle in the indexes for some weeks. I am simply tired of it!
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the usual bits and pieces across the evening...

3pm update - holding the gains

The market is holding the sp'1680s, and indeed, looks set to close somewhere in the 1680/85 zone. Metals remain weak, with Gold -$9 and Silver unchanged. Oil is holding up 1.5%.  VIX has massively cooled down, -14% in the upper 16s. A weekly close in the 20s now looks very unlikely.


sp'60min

vix'60min

Summary

Suffce to say, a rough day for many.

I can't imagine more than a few were going 'bravely long' yesterday, and even the cheer leaders on clown finance TV recognise that much of today is simple short covering.

Yet..gains are gains..and it would seem Obama/Boehner are going to play nice, at least for a few weeks.

*I see renewed calls for sp'1740/60s...even ZH was touting sp'1800s by year end.

As ever..one day at a time.

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*I remain short SLV, hopefully will be able to drop tomorrow, ahead of the weekend. I wish I had the temerity to meddle in the indexes..but...I'm just going to leave them alone for some time to come.

I'd feel a hell of a lot safer shorting this nonsense a lot higher in another 2-3 weeks.
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*Most of the momo stocks are holding gains of 2.5 to 5.0%. Its been a good year since I even considered getting involved with any of those crazy things.
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3.07pm... Clown TV is going guns-blazing 'buy the dip' .(although I think I've been hearing Bartiromo cursing in the background, lack of coffee?). 

A close in the sp'1690s would be one of the nastiest closes for the bears.  I've seen this picture before..and have shorted it..and it rarely works out well. 


3.16pm...nastiest..market...ever.   Gods help the bears not already kicked out of this nightmare.


3.32pm.. in theory..looking at the hourly trend/channel..we could close tomorrow around sp'1710..which is kinda the next major resistance.

Considering the power of today's daily candle, we'll probably be in the 1700s tomorrow, which is no doubt sickening to many of you out there.


3.52pm.. Metals getting the hammer in the closing hour..Gold -$19.. Silver now -1%..which is kinda useful to yours truly.

back at the close...