Failure to follow through worrisome

Last night I was thinking that we'd get more upside action today largely based on the technicals.  Today's 15 point drop in the Dow formed a spinning top indicating indecision in the market.  The failure to follow through today on yesterday's big gains has me worried.

I've gone back to 2008 in the Dow looking for instances where a big up day was followed by a tiny range day.  Most often, the next day is also a small range day.  The fact that we are nowhere near the upper Bollinger band of the Dow is somewhat encouraging.  And the indicators are also all somewhere in the middle of their cycle from oversold to overbought.  So there's nothing particularly bearish there.

Turning to the VIX, we see that it took a gap down day but ended by putting in a green candle, close to its 200 day MA.  Since the VIX is now in the middle of its Bollinger bands, I decided to take my profits on my XIV play this afternoon.  I know I'm risking leaving money on the table, but I'd rather do that than see my profits evaporate should the VIX turn higher tomorrow.  And we've seen it do that from a similar position a number of times this year so far.

Meanwhile, both ES and YM are higher by about 0.2% tonight at 1 AM EDT, but NQ is off by about the same amount.  So all in all, the crystal ball is a bit cloudy tonight.  There are some more jobs numbers coming out tomorrow morning and they may move the market.  J-Trader seems to believe that this may be just a consolidation and is remaining 100% long even though the issue he tracks, TNA, declined 0.63% today.

I'm not so sure.  I think once again the pivots will be key.  ES just now broke over its new daily pivot at 1323.42.  We will need to stay above this number to send the market higher tomorrow.  Similarly, the Dow closed at 12,572, just over its own pivot of 12,527.  Tomorrow's pivot should be higher.  Watch for any cross below that as a bearish signal.My best guess is that we'll see another small range day in the Dow, possibly weakly bullish.  But that assumes no real negative jobs numbers come out.  We'll just have to wait and see.