S&P E-mini: VIX supports coming fall

The low level of VIX along with bullish technical developments there supports the notion that an equity correction is forthcoming. The recent S&P 500 milestone achievement has attracted additional attention and a lack of follow through; much less a reverse could provoke and even larger correction.
The steady and uninterrupted advance this month has brought about overbought conditions. The recent ‘doji’ indicates a heightened level of indecision. This indecision is charged against the bullish contingency as they are seen as controlling the prevailing bullish trend (‘driving the bus’).
 
Finally, consider the heightened activities in Urkraine/Russia and note the long holiday weekend in the States. There is room for additional concerns and movement away from risk assets toward safety.
 
For my fixed income centric friends, this means we have not yet reached our 'cyclical yield low' for treasuries. thanks for the support. i am looking to the buy side of the street and entertaining notions of moving there from the sell side. open ears. have a great weekend.
 
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About the Author

Martin McGuire, managing director at TJM Institutional Services

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