Stock market volatility continues to be above-average. The oversold rally that took place earlier this week seems to have run out of steam.
The $SPX chart is now showing lower highs and lower lows. That is a bearish trend developing. It will remain in effect until the most recent high is exceeded (2100, in this case).
Both equity-only put-call ratios remain on sell signals.
Market breadth was very negative coming into the week, and the breadth oscillators fell to extreme oversold readings. Those oversold reading have abated, and the oscillators remain on sell signals.
$VIX gave its "spike peak" buy signal last Monday. It is trendless now, which is bullish for stocks. But a close above 20 would be bearish.
In summary, the bulls have not yet seized the moment. Yes, there were a couple of strong up days, but that was an oversold reaction it appears. Unless $SPX can close above 2100, the weight of the evidence still seems to be negative at this time.
This Market Commentary is an abbreviated version of the commentary featured in The Option Strategist Newsletter.