The next decline may fall between 60 and 100 points, challenging the Wave [iv] low or possibly the 50-day Moving Average. If so, the decline may slip into high gear.

This may be an ideal aggressive short entry.

VIX slipped to 12.46, marginally exceeding yesterday’s low at 12.48. This may signal the end of the retracement for VIX. If so, a breakout is near. The ideal signal is to rally above the 50-day Moving Average at 14.52 for a confirmed buy (SPX sell) signal.

The Hi-Lo broke down beneath its previous low at 5.00, giving it a confirmed sell signal. This is welcome news, since it signifies heavy distribution, which may remain hidden by looking at price alone.

In summary, The VIX is on an aggressive SPX sell, while the Hi-Lo appears to be confirmed.

Regards,

Tony

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Anthony M. Cherniawski, President and CIO http://www.thepracticalinvestor.com

As a State Registered Investment Advisor, The Practical Investor (TPI) manages private client investment portfolios using a proprietary investment strategy created by Chief Investment Officer Tony Cherniawski. Throughout 2000-01, when many investors felt the pain of double digit market losses, TPI successfully navigated the choppy investment waters, creating a profit for our private investment clients. With a focus on preserving assets and capitalizing on opportunities, TPI clients benefited greatly from the TPI strategies, allowing them to stay on track with their life goals.

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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