Do the CPCE and VIX suggest a top is imminent?

First, lets re-assess how we did with our last call, to see if we went wrong and if so to learn from our mistakes. Two weeks ago we used market breadth patterns to suggest a bottom was close and we would expect a rally. See here. In fact, we predicted back then, based on wave-analyses…

Market breadth: is it following the late-2015 script

One of the items mentioned by pundits as proof that a new bull market has started off the February low is the surge in market breadth. Though market breadth is important, and the surge certainly has been impressive during the early stages of the past rally, no Zweig breadth thrust was registered this time around while…

The curious case of low VIX and high CPCE

Over the past days something interesting has happened. VIX has been dropping to levels that coincide with tops/continued upside, while CPCE (equities only put/call ratio) has been increasing to rather high readings, sometimes extreme (>0.90) that coincide with bottoms. See Figure below. VIX hit our red support zone today and reversed, while CPCE was at…

SPX monthly buyers exhaustion candle?

Last week we identified a weekly “buyer exhaustion candle” on the SPX (see also here), which was the correct interpretation: one is wrong till proven right. With the month of April in the books, let’s take a look at this month’s candle (far right): we see again a possible buyer exhaustion candle (upper wig longer…