VIX Buy Signal

As most of you guys are MIA today I’m going to make this a Monday night quicky. In short the bearish case is now in the process of dematerializing – it’s not so much that the bulls have been driving this but that I have seen almost no authentic selling interest at strategic inflection points since last Thursday. There was a little drop below 1543 touching the lower 25-hour BB this morning but it was almost instantly remedied. So here is where we are right now:

Spoos are in the process of clearing the hourly resistance I have pointed out in my morning update. That’s bullish. Also if the tape continues upward into the close we’ll most likely push above the 25-day SMA – that’s also bullish. And of course there’s this:

Unless we see a late hour sell off we will produce a bonafide VIX Buy Signal today (noobs – that’s relative to equities). If you’re confused about the implications then I suggest you take a peek at our handy cheat sheet.

However, in a nutshell – given all the above and that the writing was pretty much on the wall since late Thursday we are now effectively long equities until further notice. The only reason for a change in this outlook would be a late day sell off thwarting the VIX Buy signal as well as a drop back below the 100-hour SMA on the spoos.

EUR/JPY – this would have been a great Retest Sell setup but we didn’t get the necessary shooting star (thus far). However there is the matter of those two NLBLs just below the previous high. I would take this as an excellent inflection point – short below and long above those Net-Lines.

Same idea basically on the CHF/JPY – almost the identical formation and I would play it just like the EUR/JPY.

That’s all for today folks – I’m feeling a bit on the low side tonight and decided to get some early rest. See you all tomorrow bright eyed and bushy tailed!

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Cheers,