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Mike Paulenoff

Potential Impact Of New Low In VIX

The NVDA thrust that has propelled SPX, ES, and SPY to new ATHs has crushed Cash VIX to a low of 11.52 in today's pre-market session. The last time VIX was this low was in late November 2019 just before the Pandemic panic emerged that closed the US economy. Lest we think that the absolute value of VIX at 11.52 in and of itself is a reason to be bearish equities, the Nov. 26, 2019 low at 11.42 preceded 9 weeks of relatively low VIX readings between 12 and 16 prior to an explosive up move in VIX (decline in SPX) that hit a spike high at 85.72 in March 2020.

Market Breaks Upper Support But Still Awaiting On Five Down

After trading in a very tight range over the past several days we finally saw the market break over the 5/16 high completing the micro pattern only to be followed by a sharp intraday reversal. This reversal broke under the micro support level that we had been laying out over the past several days giving us a very early signal that we may have put in a larger degree top.

Capitalizing On Fibonacci Price Clusters

Fibonacci price clusters are a great way to trade the stock index futures. The definition of a Fibonacci price cluster is the coincidence of at least three Fibonacci price relationships that come together in a relatively tight range.Here is a recent example of a few of the clusters we were watching in Thursday's session as the market collapsed before us.The 120-minute ES chart illustrates these clusters. The actual low was made in the first price cluster area on this chart at the 5272-5274 area.

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