Volatility back on the rise

With US equities opening somewhat weak, the VIX managed an early morning peak of 17.08, but with a rather strong intraday rally, the VIX settled +7.6% @ 15.98. The multi-week up wave continues, and the 18/19s look viable if sp'1950/40s this week.


VIX'60min

VIX'daily3

VIX'weekly

Summary

*as noted last week, one of the top aspects that the equity bears need to see is a weekly VIX close above the 200 MA. Clearly, Friday was a fail... but maybe this Friday will see a close in the 18s.
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Interesting day, with an opening black-fail on the hourly cycle, but still...a net daily gain.. and we're putting in higher highs..and higher lows.

The 18/19s still look viable by late Tuesday, which would likely equate to sp'1950/40s.
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more later... on the indexes

Closing Brief

US equities closed moderately lower, sp -5pts @ 1977 (intra low 1964). The two leaders - Trans/R2K, settled +0.1% and -0.1% respectively. Near term outlook is for continued weakness, as supported by the bigger weekly cycles.


sp'60min

Summary

Today was a pretty messy day. The opening weakness was certainly not expected by many, after the Friday gains... and yet once again, the bulls managed a very significant intraday bounce.

For the equity bears, at least the Thursday low of 1965 was broken (if marginally), and with VIX 17s helping to confirm it.

As for tomorrow, well, all that can be said right now is that the weekly cycles ARE bearish, but we're still seeing rather strong bounces that negate much of the declines.

All things considered, bears need to end tomorrow in the sp'1950s - with VIX 18/19s... or new historic highs can be expected in October.
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*I remain holding short.. seeking an exit in the 1950/40s, along with VIX 18/19s.. that still  seems viable tomorrow, as Q3 will come to a close.
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more later... on the VIX

3pm update - rats to bail into the close?

A very important closing hour is ahead for both sides. Bulls seem exhausted after a late morning bounce.. whilst bears are showing renewed strength, with a VIX that is battling to challenge the opening high of 17.08.


VIX'daily3

sp'daily5

Summary

... this closing hour could really help shape the next few days.. which in themselves..could determine what happens in Q4.

Indeed, Q3 ends tomorrow... are we going to see a little wash out to the 1940s, with VIX 18/19s?
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*I will likely hold short into tomorrow, unless VIX breaks into the 18s, with sp'1955/50... but that doesn't seem at all viable until tomorrow.
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3.19pm... VIX cooling, now just +7%... and bears are failing. I suppose a moderate VIX net daily gain is better than red, but still...its just not enough.

Disappointing... and if we don't break into the sp'1950s tomorrow... then this down wave looks complete.



3.36pm... Major fail for the bears. Daily index candle... spike-floor.. reversal candle.

Yes the VIX is still net higher, but really, that sort of candle is usually bullish for the next day. Any 1990s tomorrow.. and it'll be back to the lunacy for new highs in October.



3.41am... frankly, its a wonder all the bears won't be on suicide watch this evening. Promising opening declines.. only to be whipsawed by a baseless rally (if helped by $2bn of QE fuel)

As ever...its rarely easy for the equity bears... but more on that later...

back at the close