Well, as 2021 heads toward its end, the market has its 69th record high looming on this first day of the last week. Starting last Monday, the /ES has been marching up a steady ascent with the accuracy of a Swiss timepiece. The red line you see is the former intraday high on the futures, which is millimeters away at this point.
In doing so, the market has one against squished volatility to near death. The /VX has lost a full one-third of its entire value, and we’re just about in the teens, even in the futures market. I’ve noticed it doesn’t take much of a bounce in the /VX to push options values much higher, but at the moment, it would require a swift turn in psyche (which evidently is based on this puerile “Santa Claus Rally” excuse) to breathe life back into the /VX:
Perhaps the most interesting futures chart is of the NASDAQ, which for weeks has approached the red line you see and then turned tail. We are yet again doing the exact same thing.
I’ve read some comments here that, boy oh boy, if it pushes above that line, it’s going to explode higher. Maybe, but I have my doubts. The configuration of the longer-term chart suggests to me such a breakout would be met with stop-covering and new buying, but not enough to conquer the (brief) peak you see earlier in the chart.
Just five trading days to go; good luck out there!
