Volatility floors in the 13s

It would appear the VIX put in a key spike-floor (13.89), just ahead of the FOMC announcement, with the VIX settling +4.1% @ 15.12 (intraday high 15.95). Near term outlook is for VIX to climb into the weekend, first key target is last Friday's high in the low 18s.


VIX'60min

VIX'daily3

Summary

The 13s were always just about viable, and it was not entirely surprising to see them hit this afternoon.

The snap higher into the upper 15s was a pretty impressive initial move for the equity bears, and bodes for a likely challenge of last Friday's high.

What about VIX 20s? It would seem very unlikely by this Friday close, but certainly..next week.
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more later..on the indexes

Closing Brief

US equities sold lower after the FOMC announcement, sp -11pts @ 1860. The two leaders - Trans/R2K, settled lower by -0.4% and -0.8% respectively. Near term outlook is offering a test of the key 1834 low, if that fails to hold, then 1800/1790 within 5-7 trading days.


sp'60min

Summary

*First, I should note, I'm not overly concerned at the spike candle to 1850, which itself is a soft bounce resistance zone.

The damage has been done, and so far...the H/S formation I've been touting, remains very much intact.
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Fed days are rarely boring, and this afternoon certainly offers something for many traders to think about.

Having been stuck just under 1875 for almost two trading days, it would seem the 1875 has indeed been rejected..and the market is now vulnerable to much lower levels.

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I hold heavy short overnight, with short-stops around 1875. Seeking an initial exit around 1840/35..perhaps as early as tomorrow morning, which might equate to VIX 17s.

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more later..on the VIX.

3pm update - the 1875 line held

The market has seen some 'sell the news' reaction to the FOMC, although the VIX is still broadly flat. Metals are weak, with Gold having slipped -$23. We have an especially interesting closing hour ahead. Equity bears should be seeking <1860, with VIX 15s.


sp'60min1c

Summary

Unless we break (bizarrely) tomorrow, >1875, I'm holding to the H/S outlook.

Primary downside target for the formation is 1800/1790, by end of next week.

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I am heavy short, primarily via SDS, with a short-stop around 1875.

...updates into the close
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2.56pm... VIX hourly cycle...the setup is very much in favour of the bears...all the way into the weekend

Certainly, long VIX in the 14s, is hell of a lot better than the 18s from last Friday (although I'm not playing VIX in this cycle).


3.07pm   VIX 14.70s...and the 15s are now well within range by the close..along with sp'1850s.

On track..and it sets up tomorrow...very well.

3.12pm.. woah..............VIX soaring....the 16s are coming.


3.17pm... VIX 15.95.. intra high.. so far...but this is a great reversal from the failure to clear 1875.

Anyone think we'll be clearing >1875 tomorrow?
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3.22pm..the Yellen keeps on talking..and the market is now borderline sig' declines.

Perhaps most importantly..we have the weekly index cycles...turning back to bearish.

Seeking a VIX close..now in the 16s..with sp'1855/45..setting up more downside across Thurs/Friday.


3.29pm.. Battle continues...but the damage has been done. Equity bears have control..and from a purely cyclical perspective, they should be fine into the weekend.

Now its a case of when do we test the key low of 1834.

Trans/R2K, both set to close red..and this bodes well for those on the short side.


3.35pm...continued chop....but market looks exhausted...bears should be able to wrestle this lower into the close...

I'd settle for VIX >15.50 right now, along with sp'<1857


3.39pm... clown finance TV talking about the 'end of QE3'....I think the cheer leaders are starting to get twitchy.


3.43pm... Market trying to rally, but the damage has been done.

Metals weak, Gold -$25,  miners suffering,  GDX -3.7%
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I will hold short overnight..seeking much lower levels than here.


3.49pm...VIX struggling to hold gains, but still...the 15s are viable.

All things considered...this was still a key day...