Stock Market Technical Analysis Blog
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In the market today the indexes started to slowly arch over as the VIX traded sideways at the red long term overbought line shown in the charts above. I pasted a daily bars chart of AAPL on top of the S&P and VIX charts showing the pivot AAPL will be at tomorrow morning. If AAPL's red 5 EMA bounces up from its green 10 EMA line AAPL's chart could be back in business. However, if the red 5 EMA pierces down thru the green 10 EMA line tomorrow it will likely put AAPL back in sell mode. Which way AAPL plays out tomorrow will be important to Wall Street as they would really like to put a positive day on the last day of the traditional first five day push.
Looking at the VIX by itself it's important to note that market selloffs typically don't start until the VIX starts rising up away from the red line. The VIX can easily hold sideways right at the red line allowing for additional upward stock market movement sometimes for a surprising number of days. The day it starts lifting quickly from the red line is where the broad market selling begins. Note that in March of 2012 it spent three weeks basically sitting on the red line before finally starting to lift convincingly which triggered the selling days. We will have to see...
Looking at the VIX by itself it's important to note that market selloffs typically don't start until the VIX starts rising up away from the red line. The VIX can easily hold sideways right at the red line allowing for additional upward stock market movement sometimes for a surprising number of days. The day it starts lifting quickly from the red line is where the broad market selling begins. Note that in March of 2012 it spent three weeks basically sitting on the red line before finally starting to lift convincingly which triggered the selling days. We will have to see...
Alan
