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Thursday, October 14, 2010

Thursday, After the Close updates!!!

Yields in the Treasury markets have made a small reversal over the last couple of trading days, interesting to see what happens tomorrow as the FED plans on spending $32B over the next month with some purchases set for tomorrow. For a schedule of upcoming POMO days Click here!!!
The VIX DID recapture the Bollinger bands, and the down-sloping bullish wedge this afternoon, to really get going bullish, the VIX needs to break out of the top-side and make a higher high above 24.52.
The short-term squiggle count I had going on the SPX got busted once it broke below 1168.68, leaving two options for the SPX longer-term. The first is that we are building an ending diagonal where it is acceptable for the 4th wave to enter the price territory of the 1st, or that the SPX has already topped. If the SPX has topped, there is still a lack of other evidence to confirm that, only a busted short-term EW count, no broken trendlines, or other market internals that would suggest today's sell-off was overly bearish and is the start of a new down trend. With tomorrow being OPEX, ANY-thing is possible, and it should be on the radar if we do get serious follow-thru to the downside tomorrow.
Breadth closed at 1.46:1, decliners. not bearish enough in my opinion to cause alarm and is more suggestive of consolidation. Volume was a little more bearish, with total volume at 1.11T on the NYSE, slightly less then yesterdays bullish volume of 1.16T. Both days represent an increase of volume over what has been happening for the last couple of months. Very possible this is just another sign that the SPX is in a topping process as the increase in volume is a result of distribution by the big boys.

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