The VIX comes through

Well, it looks like the VIX trumps the futures.  Last night I was worried about the prospect for a rally today because although the VIX was falling, generally an indicator of higher stocks to come, the futures were all down fairly substantially.  As it turned out, the VIX predicted the market once again and we were rewarded with a pleasant 38 point advance in the Dow to break a three day losing streak.

Not only that, but the gain came in the form of a pattern that resembles a piercing line (though not quite).  That, along with indicators that are all looking to be bottoming at rather oversold levels, suggests that there is more room to rise on Thursday.

Meanwhile, the drop in the VIX today brought it back to the middle of its Bollinger bands, with all of its indicators descending and its short stochastic in particular executing a bearish crossover.  This suggests the VIX has room to fall further and that in turn suggests higher stock prices tomorrow too.

Then we have the futures.  ES, NQ, and YM are all up right now at 1 AM EDT, with ES leading the way at +0.27%.  ES has now exited its descending RTC channel going back to May 19th and that is a swing trade bullish trigger.

Oil meanwhile rose back over $100 today and since oil is still moving in sync with the market these days, that's also bullish.  And the dollar, using my $USDUPX chart looks to be ready to continue filling the gap it formed after its big jump on Monday - also bullish for stocks.

So there you have it.  All of the tea leaves seem to be in agreement tonight.  I'm reaching for my long hat and would be most surprised if we didn't get another advance on Thursday at least as good as today's.

Finally, my AKS trade from yesterday is doing well.  AKS closed at 14.72, up 0.28. AKS is now right at its 200 day MA.  If it can move past that tomorrow, I'll hold on.  If not, I'm outta there.