I last wrote about the SPX:VIX ratio on September 30.
Price action on the Monthly ratio chart below shows an inability, so far, for volatility to be held at bay, while the SPX continues to make new highs, almost daily.
It has failed to hold, with conviction, above the 250 level and advance above its next resistance level, which is a 161.8% external Fibonacci level at 280.
Price action, typically, doesn't like to leave unfilled gaps on the 60-Day 60-minute ratio chart. It gapped up on September 11 and remains unfilled. I'd expect that it will be filled in the near term, inasmuch as momentum has been fading on this timeframe and it has dropped below zero, once again. Watch for momentum to remain below zero on any gap fill.
Should price drop and hold below 200, we could see a significant drop occur in the SPX. Keep an eye on momentum on this timeframe for any confirmation of such a move.
One possible scenario that may occur (before any such gap fill) is for the SPX to make a last gasp to reach 2600 (a +2 deviation level of a very long-term regression channel), as shown on the Monthly chart below.
Keep an eye on momentum on the above chart to see if it pops back, and holds, above zero to confirm that such a rally may be imminent.
Welcome and thank you for visiting!
The charts, graphs and comments in my Trading Blog represent my technical analysis and observations of a variety of world markets...
* Major World Market Indices * Futures Markets * U.S. Sectors and ETFs * Commodities * U.S. Bonds * Forex
* The content in my articles is time-sensitive. Each one shows the date and time (New York ET) that I publish them. By the time you read them, market conditions may be quite different than that which is described in my posts, and upon which my analyses are based at that time.
* My posts are also re-published by several other websites and I have no control as to when their editors do so, or for the accuracy in their editing and reproduction of my content.
* In answer to this often-asked question, please be advised that I do not post articles from other writers on my site.
* From time to time, I will add updated market information and charts to some of my articles, so it's worth checking back here occasionally for the latest analyses.
DISCLAIMER: All the information contained within my posts are my opinions only and none of it may be construed as financial or trading advice...please read my full Disclaimer at this link.
* If the dots don't connect, gather more dots until they do...or, just follow the $$$...
UPCOMING (MAJOR) U.S. ECONOMIC EVENTS...
* Wed. July 28 @ 2:00 pm ET ~ FOMC Announcement + FOMC Forecasts and @ 2:30 pm ET ~ Fed Chair Press Conference
* Fri. July 30 @ 8:30 am ET ~ Core PCE Price Index Data
* Fri. Aug. 6 @ 8:30 am ET ~ Employment Data
* Wed. Aug. 11 @ 8:30 am ET ~ MoM & YoY CPI & Core CPI Data
* Thurs. Aug. 12 @ 8:30 am ET ~ PPI m/m & Core PPI m/m Data
* Tues. Aug. 17 @ 8:30 am ET ~ Retail Sales & Core Retail Sales Data
* Wed. Aug. 18 @ 2:00 pm ET ~ FOMC Meeting Minutes
* Wed. Sept. 8 @ 2:00 pm ET ~ Beige Book Report
*** Click here for link to Economic Calendars for all upcoming events.