US equity indexes closed broadly weak, SPX -32pts (0.7%) at 4327. Nasdaq comp’ -0.8%. Dow -0.9%. The Transports settled -1.4%.
sp’daily5
nasdaq comp’
r2k – via proxy IWM
transports
Summary
SPX: opening gains to 4375, but leaning weak across the day to 4322, and settling -32pts (0.7%) to 4327. Momentum turned negative. Bearish engulfing candle, which is distinctly s/t bearish. I would note the 50dma at 4239, and that will be within prime target of the 4250/40s across next week. I’d expect the market to then resume upward.
NAS: a fourth day lower, settling -115pts (0.8%) to 14427. The 50dma in the 14000s appears due next week.
R2K: a fourth consecutive day lower, settling -1.2% to 214.93. Bearish engulfing candle, leans distinctly s/t bearish, and I’d note the 200dma in the 205s.
Trans: the third day lower of five, settling -204pts (1.4%) to 14491. I would note the 200dma in the 13600s which appears realistic next week, before resuming upward.
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VIX’daily
VIX weekly
Volatility saw an opening low of 16.03, and immediately reversed upward (an appropriate mirror to the opening reversal in equities). The VIX climbed across the day, with a little ramp into the close (very unusual for an OPEX), settling +8.5% to 18.45.
Today’s candle is of the bullish engulfing type, and appropriately mirrors the bearish engulfing SPX daily candle. Momentum ticked upward. Soft target 19/20s.
For the week, the VIX gained +14.0%. Momentum ticked upward, settling on the fractionally positive side. Upper bollinger offers the 22/23s next week. On a stretch… the 24/25s, before cooling back.
I do NOT see a hyper spike (>30) in volatility until we’re beyond Labor day. The only wild card is a crazy geo-political event (like China>Taiwan), which is of course entirely unpredictable.
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a little more… by 6pm EST