Friday, May 14, 2010

05.14.10 - Downdraft

How long has it been since we've had identifiable downtrend days like this? Well, it's refreshing to have the market be reactive again. On today's chart, note how the VIX has exploded over 20% higher, but is now coming back in leading me to believe we've seen near-term lows at the old 50% fib level in the low SPY $113 area even though internals remain awful. Longs may also bet that directional traders will want to square up after nice short gains going into "magic" Monday.

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