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This market is definitely doing its best to frustrate both bulls and bears. Yesterday was bearish. Today is bullish. Our longs (GS, BAX, and NKE, etc) feel great. Our shorts (EWQ, AXP, and SPY, etc) don’t.

We currently hold 10 longs and 9 shorts in the Hedgeye Virtual Portfolio. Only 2 of 9 short positions have positive P&L today (UUP and SHY).

As of 1PM EST we’re pushing up against yesterday’s 11:14AM intraday high of 1104. Yesterday we called it a critical immediate term TRADE line of resistance and it proved to be into the close. Today the bulls are running up against it again. A close above it would be as bullish as a close below it bearish. In our risk management model, closing prices matter most.

All the while, the intermediate and long term TREND and TAIL lines rest above and below this market’s last price (see chart). To a large extent, seeing this market rotate in between these TREND (1143) and TAIL (1082) lines perpetuates volatility.

The VIX itself is down a hefty -9% today to 26 and from an immediate term TRADE perspective that makes it broken finally as well. From an intermediate to long term perspective, the VIX remains in a very bullish position with TREND and TAIL lines converging in the 23-24 range.

Confusing short term price action on decidedly bearish volume is as confusing does.

We’re doing a whole lot of nothing for now. Watching and waiting for the close.


Keith R. McCullough
Chief Executive Officer

Squeezy: SP500 Risk Management Levels, Refreshed - S P