Vol Looking Ripe For A Breakout
Updated
Hey guys, so vol is holding the 50 day MA, we're now back above the 100 day, and about to break above the first downtrend resistance line (in white) around 28.50. We've been in an uptrend for a week or so, with bullish price action in risk assets. It's important to note that there's upward pressure building in vol, just as more and more investors turn bearish on vol. In other words, vol is not buying the dip (and neither am I). A break above the 200 day MA this week (around 30.43), could see 38 as the next major resistance. Personally, I think we'll see mid 40's (44) before vol starts to look overbought.
If the SPY loses major Green line support this week, around 346, (see my most recent post on the SPY below), we could see a rapid deterioration in sentiment, and a seemingly over-night repricing of risk. At the moment, risk is being underpriced, and with markets near all-time highs, it could be a good time to position your portfolio for a large correction (Iran arms embargo ended yesterday, last presidential debate this Thursday, stimulus deadline/sell-the-news event looming Tuesday, earnings, election day 2 weeks away, etc., etc.)
The next couple of weeks should be very exciting, so I hope you guys stick around for the action. I really appreciate your time today, and thanks so much for stopping by. Cheers, Michael
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If the SPY loses major Green line support this week, around 346, (see my most recent post on the SPY below), we could see a rapid deterioration in sentiment, and a seemingly over-night repricing of risk. At the moment, risk is being underpriced, and with markets near all-time highs, it could be a good time to position your portfolio for a large correction (Iran arms embargo ended yesterday, last presidential debate this Thursday, stimulus deadline/sell-the-news event looming Tuesday, earnings, election day 2 weeks away, etc., etc.)
The next couple of weeks should be very exciting, so I hope you guys stick around for the action. I really appreciate your time today, and thanks so much for stopping by. Cheers, Michael
If you enjoyed today's analysis, please hit the Like button and subscribe to our profile. The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research.
Note
100 day MA holding up nicely. We hit the White line resistance at 28.50 this morning when markets turned down, and then we got rejected. Will we see a retest of this level today or possibly break through? Let's see...Note
Markets are starting to roll over, Looks like vol is making another run for it. Sitting at resistance again. It wants to break through. SPY about to see 344's and a new low of the day (LOD).Note
Seeing some strength as we approach power hour. We broke through resistance again, and now sitting at the high of the day (HOD) at 28.70. Heading for the 200 day MA at 30.40, perhaps?Note
Just broke 29, and looking more like the 200 day MA is in play as soon as this afternoon.Note
Fabulous breakout above the White line resistance, and now testing the 200 day MA at 30.40. New HOD at 29.70. Anyone selling vol today at these levels? Unlikely imo.Note
Hourly RSI looking over-bought, but on the daily, it looks like we're just getting started.Note
That's all folks! Interesting day to say the least. Bullish price action all day, and into the close, as we broke above the key White line resistance level. We're holding above major supports, and within reach of the 200 day MA at 30.40. Tomorrow should be another exciting day of price action, so I hope to see you guys there.I hope you enjoyed today's analysis. Thanks so much for your time, and have a great night! Cheers, Michael.
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