\tMeanwhile, the VIX spiked 18% to an intraday high of 13.20.<\/p>\n
\tThat was enough to satisfy the “one-day smackdown” scenario<\/a> I wrote about yesterday. The question now is…<\/p>\n \tIs that it, or is there more selling to come?<\/p>\n \tThat’s a hard question to answer. The problem is that the technical conditions on the intraday charts – like the 15- and 60-minute timeframes – were oversold enough at midday yesterday to say “that’s it.” But, by the end of the day, and after the S&P had recovered more than half of its earlier losses, the daily chart of the S&P still looks like it has plenty of room to fall.<\/p>\n \tTake a look…<\/p>\n \t \tThe S&P 500 closed yesterday just barely below the support of its 9-day EMA. It may now be headed toward the next support level near the 50-day moving average<\/a> (2503).<\/p>\n \tAlso, key technical indicators like the MACD<\/a> and RSI<\/a> have just now rolled over from overbought conditions. And there’s a lot of room to fall before they even get close to oversold.<\/p>\n \tBased on this evidence, we can easily argue for more downside ahead over the coming sessions. But I can just as easily make a case for a short-term bounce higher too.<\/p>\n \tYou see, the Volatility Index (VIX) has now closed above its upper Bollinger Band<\/a> for three straight sessions. When it closes back inside the bands, it will generate a broad stock market buy signal.<\/p>\n \tWe’ve had several of those VIX buy signals in 2017. Each one of them led to at least a short-term pop higher in the market.<\/p>\n \tAlso, the McClellan Oscillator for the NYSE (NYMO) – a momentum indicator – closed yesterday below its lower Bollinger Band. This indicates an extended, oversold condition. And the few times that’s happened this year, the market rallied almost immediately thereafter.<\/p>\n \tSo, the bottom line is… the market could go either way from here (duh). That’s not a remarkable, earth-shattering revelation. It merely indicates that we have conflicting indicators. And, in that situation, the odds are about even for a move in either direction.<\/p>\n \tThat’s different from how things looked Monday – and even Friday afternoon. The conditions were significantly overbought and the odds overwhelmingly favored a short-term decline.<\/p>\n \tToday, the situation is not so clear-cut. So, I personally took profits on my small short position yesterday. Now I’m just waiting on the sidelines for another high-probability trade setup.<\/p>\n \tBest regards and good trading,<\/p>\n \tJeff Clark<\/p>\n \tP.S.<\/strong> Lately, I’ve been very interested in how the cryptocurrency space could pan out in the years ahead. I’m sure many of you have, too.<\/p>\n \tFor these sort of questions, I always refer to my colleague, Palm Beach Research Group’s Teeka Tiwari. And that’s why I plan to attend his special free training seminar airing on November 2 at 8 p.m. ET\/PT. There he’ll reveal one of the biggest crypto opportunities for 2018… and walk through the process of taking part for everyone in attendance.<\/p>\n![\"\"](\"http:\/\/assets.jeffclarktrader.com\/ee-assets\/channels\/articles\/Screen_Shot_2017-10-26_at_11.08.02.png\")
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