SPX retraced 65% of its decline, a reasonable bounce, before retreating back toward its opening price. Filling this morning’s gap give SPX permission to decline even further. That may not happen until later this afternoon. My best analysis is that SPX may level off in a 2-hour consolidation until early afternoon. However, a decline beneath Short-term support at 2277.08 may put SPX in a position to challenge (and possibly defeat) Intermediate-term support at 2268.40.

VIX declined to 11.40, nudging the open gap, but not filling it. A surge above mid-cycle resistance at 11.97 puts the VIX back into the uptrend. There are still some resistance layers above the 50-day Moving Average that need to be broken to confirm the rally in VIX.

The Hi-Lo Index vaulted to 165.00 at the open and has remained steady since then. This puts the indicator in neutral until the close. We may check its status to see if it is back beneath the mid-Cycle and 50-day resistance levels. Today’s volatility should also show up in the Hi-Lo.

TNX is higher, but no breakout. The momentum indicators are in neutral, so anything can happen in the TNX later today.

Regards,

Tony

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As a State Registered Investment Advisor, The Practical Investor (TPI) manages private client investment portfolios using a proprietary investment strategy created by Chief Investment Officer Tony Cherniawski. Throughout 2000-01, when many investors felt the pain of double digit market losses, TPI successfully navigated the choppy investment waters, creating a profit for our private investment clients. With a focus on preserving assets and capitalizing on opportunities, TPI clients benefited greatly from the TPI strategies, allowing them to stay on track with their life goals.

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