For Improving Investor Sentiment To Continue Into Frothy Territory, Need Cooperation From Flows, Which Continue To Disappoint

posted in: Derivatives, Equities | 0

Investor sentiment is elevated. This is also evident in the CBOE put-to-call ratio and in VIX. Fund flows, however, continue to remain anemic even though the S&P 500 has rallied north of 20 percent from last October’s lows. Unless fund … Continued

No Washout In % Of S&P 500 Stocks Above 50-Day But Low Enough To Allow Rally In Index

If the overnight strength in the futures market sticks and Tuesday’s CPI report cooperates, there is room for continued rally in stocks. Some indicators such as the percent of S&P 500 stocks above the 50-day are way suppressed, although the … Continued

Possible Decline In Volatility Could Aid Stocks

posted in: Derivatives, Equities, Technicals | 0

VIX acts like it wants to go lower for now. Concurrently, VIX:VXV is in overbought territory. And both the CBOE put-to-call ratio and the ISEE index point to growing investor pessimism. For the first time in four weeks, VIX went … Continued

Second Bullish Weekly Hammer On Oversold S&P 500 In 5 Weeks, Relief Rally In Store

For the second time in five weeks, the S&P 500 charted out a bullish weekly hammer. Sentiment readings are suppressed, although non-commercials are at risk of being too bullish. Near-term, the path of least resistance is up – magnitude and … Continued

CoT: Peek Into Future Through Futures, How Hedge Funds Are Positioned

Following futures positions of non-commercials are as of October 26, 2021. 10-year note: Currently net short 114.8k, up 114.3k. The FOMC meets next week. This is the year’s seventh meeting. After this, one more remain. At the September 21-22 meeting, … Continued

Equity Volatility Itching To Perk Up – Magnitude And Duration Notwithstanding

posted in: Derivatives, Equities, Technicals | 0

Equity volatility looks to be on the brink of a rally. The only question is if it will sustain higher or momentum will soon peter out as has been the case since its explosion in February-March last year. VIX shed … Continued

VIX Could Drop Near Term To Test November 2017 Rising Trendline, Which Should Hold

posted in: Credit, Derivatives, Equities, Technicals | 0

VIX recently broke a month-and-a-half rising trend line, subsequently coming under more pressure. In the right circumstances for volatility bears, the index could drop more near term, but a longer-term trend line support is unlikely to break. On June 29, … Continued

Breakouts Imminent On Major US Equity Indices, Staying Power A Question Mark

posted in: Derivatives, Equities, Technicals | 0

Major US equity indices are itching to break out. The question is, what then? Indices remain stretched on several timeframes. Longs have shown dogged determination but shorts are likely to decide if the momentum will have the staying power. Equity … Continued

With Outsize Influence On S&P 500 And Nasdaq 100, Top Six Get Ready To Report

With subtle signs of distribution hitting major equity indices in recent sessions, results from the top six US companies – all tech – could not have come at a more important juncture. The 1Q21 earnings season is one fourth through. … Continued

Potential VIX Breakdown Near-Term Opportunity For Equity Bulls, But Volatility Curve In Contango Medium-Term Risk

posted in: Credit, Derivatives, Equities, Technicals | 0

VIX is on the verge of a breakdown. After sustaining over 20 for a year, it risks losing that level in the sessions ahead. A decisive breach opens the door toward mid- to high-teens near term. This will have taken … Continued