This rally has certainly lasted a lot longer than i expected. However, it is possible that the Phoenix is ready to soar again. Many expect a quick return to ATHs, and that is certainly possible. More expect a final retest of the March lows. I personally still expect that the Phoenix will obliterate almost everything in the next round, whenever it comes.
Technical, what we can see here is that the VIX has formed a tight bull flag from the Mar 23rd market bottom, and that flag is reaching its terminus. RSI bullish divergence is also clearly present. Therefore, there are two conditions I will follow now. If we break up above 42.25, I will expect a market capitulation wave and VIX to soar above 100. If we break below 32.5, then somehow the masses are right for the first time in history and the crash is likely finished. I would be shocked if the latter comes true, but everything is possible.
Good luck all!
Technical, what we can see here is that the VIX has formed a tight bull flag from the Mar 23rd market bottom, and that flag is reaching its terminus. RSI bullish divergence is also clearly present. Therefore, there are two conditions I will follow now. If we break up above 42.25, I will expect a market capitulation wave and VIX to soar above 100. If we break below 32.5, then somehow the masses are right for the first time in history and the crash is likely finished. I would be shocked if the latter comes true, but everything is possible.
Good luck all!
Comment:
VIX broke wedge resistance at 42.5 overnight. Now it must retest and break out again. Could take 2-4 tries, but once it flies through 42.5, the trajectory I laid out should start to play out.
Comment:
As usual, the market dragged this play out longer than expected. Today's close was a good start, but it will take a few more days of volatility advance before I can see a clearer picture. Initially, we need to clear 35.5, but 48 must also be taken out in short order if the Phoenix is to truly soar again. Will update with a new chart if things begin to shape up.