Minor Wave 5 is reduced to undecipherable squiggles as the SPX climbs the lower trendline of another Broadening Wedge formation. The break occurs at 1761.00, so we may be on the alert for it.

In addition to a weak SPX, the VIX is stuck in positive territory, for once.

ZeroHedge comments, “One of our readers pointed out to us last week that the recent strong rise in the so-called CBOE SKEW index should also be counted among the various divergences that make the stock market's current advance suspect. Skew measures the perceived tail risk of the market via the pricing of out-of-the-money options. Generally, a rise in skew indicates that 'crash protection' is in demand among institutional investors (institutional/professional investors are the biggest traders in SPX options).”

Be alert to the levels I have mentioned, or your own analysis of where the major shift is in the markets.

Regards,

Tony

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Disclaimer: The content in this article is written for educational and informational purposes only. There is no offer or recommendation to buy or sell any security and no information contained here should be interpreted or construed as investment advice. Do you own due diligence as the information in this article is the opinion of Anthony M. Cherniawski and subject to change without notice.

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