With Monday being the first trading day of the new month, I would expect a bullish bias. I would feel more sure about those expectations had Friday been a down day - or at least flat. It was not.
All indicators are showing lack of direction in the markets by either flipping back and forth between a bullish and bearish bias or meaningless data. Market breadth is generally bullish, except on the big down days when it slips to bearish. The SKEW is middle of the road, showing no conviction to the upside nor fear of the downside.
The number of stocks above their respective 50-day moving average is converging to its middle around 55%. The market has gone sideways when we get stuck here.
 |
| MMTW is stuck in the middle of its range |
The volatility complex generally has maintained a slight bullish stance all through the recent sell off. The short term VXST has spiked higher than the longer term measures of volatility, but has not been able to hold that bias. At the same time, all volatility indexes are demonstrating an upward trend in their low points. This could be interpreted as a bearish forewarning signal.
 |
| Volatility was low and is now trending higher. |
When VIX can break and hold above 15 there would be a larger sense of bearishness that would warrant a more directional position.
