Hunger Games

These are the type of markets where you can't even go out for lunch, for fear of missing a huge move.  Literally having to stay hungry to trade the action.  And there is a lot of action now, you can always tell when the DOM thins out and the algos pull bids and offers at the hint of iceberg orders or size coming into the market.  That also goes for the ES overnight market as well. 

It was a classic overnight session, as Thursday night is the official Fright Night for SPX, as equity traders hate to go long over the weekend when markets are weak, and sell out early ahead of the weekend.  As much as the patterns are more random and less influenced by human traders, at the end of the day, the risk managers are all human, and the tendency is to avoid taking on risk exposure when volatility goes up and markets are weakening.  That means selling stocks. 

When the VIX jumps like it has over the past 2 days, usually the stock weakness lasts another 2-3 days at minimum, before the first significant rally attempt.  That means I don't expect much upside from current levels (2945) until next Wednesday.  The downside will probably somewhat limited for the next few days also, as I see support coming at 2920, near the tops from last October, and area of short term support in late June, and 2890, the top of the range during the volatile trade, post Trump tariff announcement in May.