As I mentioned yesterday, the VIX looks like it's forming a head a shoulders pattern. That post was early in the morning. By the close the VIX had formed a drooping shoulder and is now well on the way to the 50 day MA at 13.71. Amazingly, the Qs are NOT overbought at this level and will probably blow through the 50 target that Carl Futia posted last week. The markets are showing consistent upward bias on all tehnical indicators. Carl also posted a recent update to the domed house pattern yesterday and it's worth a close look. If he's correct ,the DOW has a upside target of 14,600 in November and the rest of the market will probably tag along. As a hard-wired skeptic of current market strength, I am looking at strategies to integrate Carl's scenario into my tactical trading plan in order to capture some of those potential gains while still hedging risk. Naked put selling short term is my current choice with some low risk setups still attractive. More on this later.
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