RVX Still Creeping Up

The Russell 2000 Volatility Index is still creeping up, hinting that there is still some room for the RUT to falling.

The RVX closed today at 75.44 which is a 2 week high.

RVX Daily Chart:

SPX Downside Target

Looking at the monthly chart it seems likely that the momentum will now take the broad market index down to the 800 and 775 levels of 2002 and 2003. With today's close at 850.75, unless the bulls show up tomorrow this could be a one day shot down to 800 for starters.

SPX Monthly Chart:

RUT: The Good News

Looking at the RUT monthly chart there appears to be some horizontal price support in the 350 area. If the RUT closes below the recent lows of 440 it could easily drop down to retest the 2003 lows in the 350 area. The market is showing us that it has little interest in stabilizing.

RUT 20 Year Monthly Chart:

Monday RVX / RUT Numbers

The RUT pulled back today, and in doing so the RVX shot up to retest the downward trendline in the 65 area. It is still holding the downtrend, but at the same time the RUT actually "broke" it's up trend on the daily charts -- MIX SIGNALS, really need to see how the next few days play out to see where we go.

With price being king, the Bears have the edge with that trend break today. Not much support on the daily chart should the RUT break below 490 tomorrow. Could easily retest those lows again quickly.

RVX Daily Chart:




RUT Daily Chart:

RVX Levels

The RVX chart is starting to look very interesting. The uptrend was finally broken and the retest of the "back" of the upward trendline rejected the RVX sending it lower to close at 59.73 on Friday. This created a bearish engulfing pattern on the RVX so the current bias is bearish on this volatility index.

Based on this pattern a target of 45 by month end is entirely possible. Once it cracks below 55, there is not much support to catch it before it hits the 45 area.

Key area to watch first is the 55 level.

RVX Daily Chart:

RUT Monthly

The November range thus far has straddled the fence on the long term monthly uptrend on the 20 year chart.

Keep your eye on where it closes at month end as it is likely to hint at the next short term leg up or down.

RUT Monthly Chart:

Friday TF (RUT Futures) Intraday Chart

Oct. 31, 2008 TF 5Minute Chart:

Note the power of the 20MA on this 5 minute chart.