More thoughts on the VIX, exponential moving average cross and more equities indicators to consider

Let's take more of a look at the VIX and some other indicators. First, a definite nod to Bill Luby with his VIX and More blogspot. Bill - you may have nibbled in with some puts on Wednesday, and feeling an "ouch" today - but remember that being early isn't always the same thing as being wrong, even if it feels like it (ask me how I know!). Folks, click and see what Bill's been posting - it's good stuff as always. At right is the VIX chart and frankly, I did believe a couple of days ago that the VIX would respect the newest trendline but oh well ... maybe the SPX Fibonacci 1014 trumped it - but notice that the VIX has still respected its own Fibonacci 24/24.78 level by giving us a higher low. I realized yesterday that the ETF called VXX was making a new low - ouch, that's either weird or a clue that the VIX futures players think VIX may yet head lower again. Breaking the trendline doesn't say that it will happen, but breaking under 24 by the VIX will say it's happening ... I doubt it, but will see of course.

The CPCE has been low, down under .60 a lot lately, but closed a bit higher at .64 - clue there? Also the TRIN was somewhat elevated during the day and closed somewhat higher. Its 10-day moving average closed at 0.83 which is very close to a swing trade sell (under 0.80 will usually do it). Its MACD and CCI indicators look interesting too, and I'll let those speak for themselves (see TRIN chart at right).

The ISE sentiment data shows readings high but not as high as the 200+ readings at the end of July/beginning of August - someone got it right, eh?!

And look - I know there are folks out there who have for one reason or another held bearish positions through today - I do know and actually I do understand. Now here is the deal - we've reached such a significant set that it's stretched about as far as it can go, and we have to make ourselves a promise. If the markets do not turn down from the 1014 level - giving some room for a move over the next few days to resonate the number as markets often do - so that for example, let's pick Tuesday or Wednesday ... if we do not see a move down at that point, then we've gotta step aside at least, even if it doesn't feel right to buy into more upside. Assuming we get a move down, it can be huge. Alternatively, it can set up a zigzag pattern that zigs and zags up to 1053, so be aware of that. We'll track it closely believe me!

There are some noting that the SPX has confirmed a bullish trend on the weekly charts by having the 13-week exponential moving average (ema) cross above its 34-week ema. That chart is below (putting the ema's onto my Fibonacci retracement chart on the weekly SPX). Click on the image to see it larger or more clearly if you need to. And that StochRSI has already been reading bullish momentum for a while hasn't it! Notice that the StochRSI is not like the regular RSI - when it's up, it's telling you that the momentum is there until it moves under that 0.8 line. It did that with the H&S head-fake but popped up again confirming the breakout over 912.

If the Fibonacci retracement does its magic along with the Elliott Wave views, and we see either a pullback or more bearish than that, obviously these other indicators including the bullish 13/34 cross will start telling a different story too. Perhaps one way to read it, is that we get a pullback, and then the rally can take us higher whether to 1053 or more. One day, and one week, at a time!