By Lawrence G. McMillan
Market volatility has remained high, and we can expect these high levels of volatility to persist.
Even with this volatility, the chart of $SPX is still in a trading range. Once again -- for the fifth time this month -- 1990 has proven to be support. To say that 1990 is an important level would be an understatement. If it gives way, a much more bearish situation would develop. On the upside, there is resistance at 2065.
Equity-only put-call ratios remain on sell signals. They rolled over to sell signals about ten days ago, and the ratios have been rising ever since.
Market breadth oscillators have been jumping back and forth between buy and sell signals. For the record, both breadth oscillators are still on sell signals.
Volatility indices have been moving within a trading range as well, although in the case of $VIX, it's not as well-defined as the trading range of $SPX. $VIX is spiking higher now, but if it spikes back down from here, another buy signal would occur.
In summary, despite the seeming negativity of trading this week, $SPX remains in a trading range, and the indicators are somewhat mixed. So, unless $SPX breaks out of its range, expect volatile trading patterns, but not much of a market trend.
This Market Commentary is an abbreviated version of the commentary featured in The Option Strategist Newsletter.
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