{"id":18979,"date":"2021-09-23T07:30:44","date_gmt":"2021-09-23T11:30:44","guid":{"rendered":"https:\/\/www.jeffclarktrader.com\/?p=18979"},"modified":"2021-09-23T07:30:44","modified_gmt":"2021-09-23T11:30:44","slug":"can-we-make-it-seven-in-a-row","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/can-we-make-it-seven-in-a-row\/","title":{"rendered":"Can We Make It Seven in a Row?"},"content":{"rendered":"

The stock market just triggered the seventh Volatility Index<\/a> (VIX) buy signal of the year. The previous six buy signals generated big gains within just a couple of weeks.<\/p>\n

And, this buy signal could do the same…<\/p>\n

The VIX spiked sharply higher on Monday. It popped above its upper Bollinger Bands<\/a> (BB). And, it closed at its highest level since May.<\/p>\n

Take a look at this VIX chart…<\/p>\n

\"Chart\"<\/div>\n

The blue lines on the chart are the Bollinger Bands. They show the most probable trading range for a stock or an index. For the VIX, though, Bollinger Bands also provide strong trading signals.<\/p>\n

As we’ve seen many times, whenever the VIX closes above its upper BB, it indicates an extremely volatile condition – which usually occurs during a steep decline in the stock market.<\/p>\n\n\n\n
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Free Trading Resources<\/strong><\/p>\n

Have you checked out Jeff’s free trading resources on his website? It contains a selection of special reports, training videos, and a full trading glossary to help kickstart your trading career \u2013 at zero cost to you. Just click here<\/a> to check it out.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Then, when the VIX closes back inside its BB, it generates a broad stock market buy signal. Previous signals are marked with a red arrow on the chart.<\/p>\n

Here’s how those signals played out on the S&P 500 so far in 2021…<\/p>\n

\"Chart\"<\/div>\n

The VIX buy signals didn’t always mark the exact bottom of the decline phase. But, the S&P 500 was higher a few weeks later – every single time.<\/p>\n

Of course, that doesn’t guarantee the market will be higher a few weeks from now. But based on the action under similar conditions so far this year, the chances look pretty good.<\/p>\n

The real question is whether this buy signal will trigger an intermediate-term rally lasting several months, like we saw in March, or if this rally flames out in just a few days and leads to an even more significant decline.<\/p>\n

For the moment, I’m leaning towards the latter scenario…<\/p>\n

Any rally from here seems likely to run out of fuel before making a new all-time high. That would create a “lower high” on the chart and set the stage for another strong decline.<\/p>\n

But, we’ll worry about that situation when we get there.<\/p>\n

For now, we have a VIX buy signal. So, the odds favor at least a short-term rally from here.<\/p>\n

Best regards and good trading,<\/p>\n

\"signature\"<\/p>\n

Jeff Clark<\/p>\n

<\/p>\n

Reader Mailbag<\/h2>\n

Are you anticipating a rally, or a decline in the market?<\/p>\n

Let us know your thoughts – and any questions you have – at feedback@jeffclarktrader.com<\/a>.<\/p>\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

Any rally from here seems likely to run out of fuel…<\/p>\n","protected":false},"author":49,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"ep_exclude_from_search":false,"service":"","footnotes":""},"categories":[1],"tags":[],"publication":[10],"person":[7],"newsletter-type":[],"ticker":[],"class_list":["post-18979","post","type-post","status-publish","format-standard","hentry","category-market-minute","publication-market-minute","person-jeff-clark"],"acf":[],"_links":{"self":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/18979","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/users\/49"}],"replies":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/comments?post=18979"}],"version-history":[{"count":0,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/18979\/revisions"}],"wp:attachment":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/media?parent=18979"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/categories?post=18979"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/tags?post=18979"},{"taxonomy":"publication","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/publication?post=18979"},{"taxonomy":"person","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/person?post=18979"},{"taxonomy":"newsletter-type","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/newsletter-type?post=18979"},{"taxonomy":"ticker","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/ticker?post=18979"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}