Thursday, June 04, 2009

Market Volatility: Noise or Non-confirmation?

Since March the VIX has been meandering down as the S&P charged higher. The VIX has now reached a point where supporting technicals are not confirming the new lows in the VIX but at the same time have not reversed the net bearish turn from March.

The past couple of weeks reflect the listless pattern of summer trading more than any strong inkling for a reversal but should this change it would be another warning to add to the confirmed bearish note in market breadth.

Look to the bullish wedge (and break of wedge resistance) on increased technical strength as a marker for change.

Dr. Declan Fallon, Senior Market Technician, the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.