Zeev's Turnips Patch-No Politics (ZEEV)

[augieboo]

Looks like VIX & VXN have bottomed:





Both are at record percentages below their own 200 day moving averages as well:





So, what does it mean?

Conventional wisdom from the last three years says this VIX/VXN configuration means the market is about to tank in a huge way.

But, some work I've been doing with various versions of my own summation indexes, plus my study of the NYSE summation indexes going back to 1926, (which are available to subscribers at Decisionpoint.com), suggest that, while a decent correction is probably in order here, we would be foolish to expect another huge plunge to new lows. Indeed, the current configuration of the summation indexes suggests that a cyclical bull move is starting and that any correction in the next few weeks may be just a prelude to more upward movement.

Somebody -- either conventional wisdom or my analysis -- is likely to be HUGELY wrong here, so I think EXTREME CAUTION is in order.

All things considered, I am going to sit on the sidelines and watch for at least a few more days. I should note also that I have been flat for more than a week now.