Bottoming Process Progressing

EOD: Marginal turn down signal in volatility so could be more market upside to come.

11:28pm EST: Daily and intra-day breadth is improving so far. A turn signal down in volatility [mkt goes higher] is trying to set up but mid-day vectors can swing either way by close so it will need to be looked at this afternoon. Vix may need to go lower preferably greater than (-) 5% to create a bidirectional vector pair that would support a volatility down turn signal potentially at a weekly degree.

Original post-
Previously it was observed that the lower prices bounding box likely needed to be a tighter ratio between instruments. There has been some improvement in that direction. However, the set up has some concerning developments. The Bollinger Bands have been pierced at the daily level and SVXY is remaining elevated although it's previous low is within the prior bounding box so it may not be required to sync. up. A noticeable amount of weakness in the market has become increasingly apparent for the last three months. Volatility flags were raised beginning in early July which resulted in the first lower BB piercing in the chart shown. A second flag has resulted in the current situation with two consecutive piercings of the BB. If this is an unwinding event, it may take some time to complete but new highs will need watching closely.

A turn signal watch in volatility is active in either direction [market up / down] and will be posted when observed. Daily summation index MACD / STOCH is still in a position typically associated with a bottoming process although it is very slowly attempting to move up. Also, as mentioned in prior posts, the 'tail down' on the 50ma on the weekly NYAD is only at a very nominal level for a top though equal in placement to the 2018 first top and actually trying to turn up slowly so could be more to go yet which puts this decline potentially into the 'pivot' category with a terminal top yet to arrive. Typically terminal tops are a few percent higher than pivot highs but can take any length of time to materialize- usually when everyone has calmed down and in a 'crisis averted' mentality only to be surprised they were walking on ever-softening quicksand.

The bots will flag here when they see a top. (1/25/20, 2/20/20)
This Information Is For Entertainment Purposes Only. Financial Loss Can Occur From Investing.
Our favorite go to site- McVerry Report