Best Financial Markets Analysis Article Here’s another piece of evidence that the VIX may be going considerably higher. It nudged against an inverted Head & Shoulders neckline that targets 28.46 as a minimum advance and is pulling back for the breakout. Should this neckline be broken, as I believe it will, this becomes an argument for a much steeper decline in SPY/SPX in a third wave. The bounce that I had modeled for SPY is getting modified below..

SPY is reaching for point 7 of the smaller Broadening Top formation, giving double confirmation to a potential Crash event coming next. You can see the two-degree point 8 targets at the bottom right of the chart.

I had been used to seeing point 6 coming in below the trendline and often 3-5% below point 4. I held out for a while thinking that point 6 should be lower, but when the retracement started to move higher, I went back to the text and all it requires is that point 6 be lower than point 4. In this case, point 6 isn’t even 1% lower than point 4 due to intervention, but the pattern remains a valid one for a pending crash starting in the overnight markets.

Good luck and good trading!

Regards,

Tony

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