US equity indexes closed broadly lower, SPX -31pts (0.8%) at 3757. Nasdaq comp’ -1.4%. Dow -0.4%. The Transports settled -2.3%. R2K -2.2%.
sp’daily5c
nasdaq comp’
r2k
transports
Summary
SPX: the 6th day lower of 8, printing a new cycle low of 3749, bouncing to 3789, but a final minutes mini implosion to settle -0.8% to 3757. Yesterday’s bearish engulfing candle played out.
I would especially note red gap around 3700, which is also a key area of support for the bigger weekly and monthly charts. At best… a bounce to around 4K… but confidence of that is LOW.
Its entirely possible we just cut straight through the June low… and keep going to 3400/3200. Again, even if we do bounce, the market should swing lower, and take out the June low.
Best guess… 3700 ‘broadly’ holds, and we bounce to around 4K.
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NAS: the 6th day lower of 8, settling -1.4% to 11066. Support 10900/800s. Grander target 8000/7000s… which are viable on a semi-crashy move.
R2K: the 6th day lower of 8, settling -2.2% to 171.41. Yesterday’s bearish engulfing candle played out. Support 165s.
Trans: the 7th day lower of 8, settling -2.3% to 12354… a new multi-year closing low. Yesterday’s bearish engulfing candle played out.
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VIX’daily
Volatility was subdued, the VIX settling -2.3% to 27.35. Yesterday’s black spiky candle did play out, and its notable that the VIX didn’t reflect net equity declines. Momentum ticked lower.
A sustained VIX spike >30 is due… but the daily indexes are all cyclically low, and prone to clawing upward into early Oct’ (for whatever unjustified excuse).
I have to see VIX 40/50s in Oct’… even if we only make it down to sp’3400, which clearly isn’t that bold.
I am resisting buying any VIX CALLS at this time.
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Looking ahead by 6pm EST