The good news is that today's drop looks like a bull market dip given that the day began with a sizeable gap down and major weakness within the first half hour of the day. This is going to lop off quite a bit of the bullishness being displayed by the dumb money indicator. Eventually that gap will likely get filled which means higher prices are ultimately in store.
The bad news is that the VIX spike that was in the making fizzeld out by the end of day on a just a weak rally attempt. This signals complacency and gives the bears still quite a bit of fuel in the tank to take this market lower and I suspect we will see it lower.
If tommorow we see an up or flat day and the VIX drops below 22 better watch out below because I think we could see the bottom fall out from this market....I'm not calling for a crash here but rather that we could see a move towards 1070 quite quickly.
Bottom line: this market is not done going down even if there's a bounce. But don't get too excited bears because this is likely just a bull market correction.
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