While there was an interesting post-Fed reaction, ultimately we remain in an interminable consolidation channel. Is this a bull flag, or is it post-July 27, 2011 again? We did come quite close to breaking out of the channel, after all.
Well, the RUT may provide some indication.
The RUT fell disturbingly close to a new low or at least a gap fill today, portending a rather bleak outlook for the broader markets. Could the SPX still eke out a new high? Yes, but resistance looms close overhead.
I managed to make a tiny profit on a SVXY (short VIX) scalp today, but am now long UVXY (ultra long VIX). Just about the only thing the market has on the up side right now is a sliver of hope from the ECB and "election year seasonality". The down side has normal August seasonality, SoulJester's Red Line Scenario, Scottick from Daneric's Elliott Waves's earnings-opex week patterns, and persistent backwardation between the SPX futures and the SPX itself, not to mention a litany of unresolved fundamental and structural problems with the economy.
From a social mood perspective, the Olympics are a perfect topping opportunity; by definition they represent the world uniting to compete in sports rather than in war (and most of the sports they compete in are non-violent, bull-market sports). Granted, the Olympics happen every four years and their scheduling and location is planned several years in advance, so we can hardly attribute major social mood tops and bottoms to their mere occurrence. It is more likely that social mood gauges the overall mood towards the Olympics.
At any rate, we are, as always, on the brink of the future. And it looks bleak.
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