Oil and gold got slammed today, but the Qs held together nicely after a modest low volume early retreat. The entire market seemed to be in a fog mid morning, with volume dribbling along and no real momo to one side or the other. As I have mentioned previously, just because the Qs are clearly overbought at this point doesn't mean they can't continue to get more overbought.I'm still sticking with my game plan outlined this weekend and am looking for short term weakness to creep in by next week.
The VIX did make it to the 10 DMSA as the major indices declined, although the Qs failed to participate. As the VIX MACD has turned up and the histogram is above the zero line I suspect the VIX will continue to rise with the 16 day MA the next target. My VIX retracement study of last week predicted an 82% probability of hitting that target in 4 days after the bounce off the lower band. Today's action counts as day 3 so I'm curious to see how tomorrow plays out.
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