– VIX “threw under” its Ending Diagonal this week in what may be its Master Cycle low. This would be the lowest reading for the VIX since December 2006, when it reached 9.39. There was no Ending Diagonal at the 2006 low, however. Diagonals imply an “immediate” and complete retracement from the peak, which was the November 2008 high.

 

 

 … Continue reading →

 

 

 

– VIX found support at the lower trendline of its Ending Diagonal. The reason the Volatility Index is so low is that no one is buying portfolio protection in the options market. Think about it.

 

 

 

 

 

 

 

 

SPX throws over its Ending Diagonal.

– SPX “threw over” its Ending Diagonal upper trendline on Friday. Ending Diagonals… Continue reading →

 

 

 

– VIX probed mid-Cycle resistance at 20.22 this week before falling back to Short-term support at 13.38. It closed just above Intermediate-term support at 15.27. Last week I warned, “Be prepared for a fast-moving rally in VIX that may challenge its 2010 and 2011 highs in a matter of a few weeks.” The 2011 high (48.00) may be in reach once the… Continue reading →

 

 

– VIX reversed strongly from its low, challenging its 40-week moving average at 16.38 before making a 50% retracement. Last week I had called for a major cycle low and we got it. Be prepared for a fast-moving rally in VIX that may challenge its 2010 and 2011 highs in a matter of a few weeks. The 2010 low-to-high (48.20) took 25 days,… Continue reading →

 

 

– The VIX made a second throw-under beneath its Bullish Wedge trendline within a month. The new low made on Friday fulfills a long-term Cycle pattern that actually called for a low on that precise day. Cycle patterns are the raw materials from which a practitioner works. A Cycle Pivot may be either a high or a low. While benefit may be derived… Continue reading →

 

– The VIX closed a third week above its Bullish Wedge trendline. The trendline now acts as a base of support for a move higher. The third weekly closing within a 13 tick range belies the fact that it may be prepared to challenge overhead resistance as early as next week

 

 

The Bearish Wedge trendline is still holding.

 

– SPX cannot… Continue reading →

– The VIX remained above its Bullish Wedge trendline for a second week. The trendline now acts as a base of support for a move higher. What is noteworthy is the net non-commercial spec position in VIX futures just plunged by 16,222 contracts to 104,284. This was just shy of the all-time low net VIX spec position hit in early December. The inference is that… Continue reading →

 

 

– The VIX closed above its Bullish Wedge trendline this week after making a throw-under. Emergence above the trendline indicates the decline may be over. The VIX is notably divergent from its expected action, considering the new highs in the SPX. This divergence may be a warning of changes to come.

 

 

 

 

 

 

SPX Throws over its Cycle Top.… Continue reading →