Impressive day today with a strong close. As of last week, we were forming a low base pattern, signaling more down side to come. I was anticipating more selling to happen at the start of this week. And......Well..... Here we are blowing 3800 a kiss before tomorrow. However, last week, I did have in mind a cup and handle pattern forming before making its way lower. Reason behind that, is due to the amount of selling we experienced throughout the month of September. So there was a high probability of a small rally to complete the cup and handle pattern. I think we have to wait to see the reaction at the 20 day moving average. Which, we're technically there. Could we go test that 50 day average by the end of this week? That would put us at 3900ish. Super aggressive move that COULD happen and still form the cup and handle I'm looking for. But overall, my lean is more on just hanging out here in this 3800ish area for a couple days. Then, slowly start making our way down to complete the handle. If the VIX gets to 40, within the next 5-7 trading days, then I think we can head lower much faster. Only time will tell. Happy trading everyone!
