Coincidence? I Think Not

One of the signals which convinced us to call a top a few weeks ago [see: Correction Warning] was the bullish (bearish for stocks) 10/20 cross in VIX. Should bears be concerned that the cross just unwound?

And, in an attempt to answer the many questions raised by my observation that SPX’s bounce at a 10.0056% decline from its recent highs – 19 cents away from exactly 10% – I offer the following charts. Note that VIX collapsed seconds after SPX reached the 10% correction mark. Coincidence? I think not.

Note that ES has formed another rising wedge that should see SPX open modestly higher. But, it would take more fancy footwork to keep the bounce going.