This evening we have the VIX sitting at its lowest level in four years. At 14.69, it seems to have a lot more room to rise than to decline further. In addition, as of Friday, both the Dow and S&P indicators entered overbought territory. The Dow hit its upper Bollinger band and the S&P is close.
On the other hand, we do have all three futures up at this hour (12:45 AM EDT), but only by small amounts around 0.1%. The ES, at 1332.50 is close to an important resistance level at 1338.
However, we have not yet seen a reversal candle on any of these charts. And there certainly is no indication of a reversal from the rising regression trend channel, if you can call three up days a trend, given the choppy action of the past few weeks.
Based on all this, I suppose it's possible to see a bit more of a push higher tomorrow, especially if we get some more positive earnings reports, but technically at least there seems to be more risk than reward short term in this market. So it looks like we're going to go lower if not tomorrow, then on Tuesday.
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