As we discussed last week, VIX is at the threshold of what would be a major break in trend. Every such past setup in which VIX broke down resulted in stocks breaking out above important overhead resistance.
S&P futures are up 10 points and are now only about 27 points from all-time highs — the result of VIX being hammered to new lows after rallying nearly 10% yesterday.
ES’s rising channel from December, kicked off by a meeting of the Plunge Protection Team, broke down two weeks ago. But, it hasn’t mattered. ES continues to melt up, guided by an overhead trend line which will intersect 2947 around Apr 26. Only if VIX bounces strongly will stocks avoid new highs.
As for earnings and economic data, the algos could care less lately.
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