Volatility (VIX) is so stretched right now that when it pops to the upside I think we’re going to see a sharp selloff that is going to surprise a lot of people. With that being said, I think it will be a good idea to buy this next dip because the charts suggest we’re going higher, at least that is what my timing signal is suggesting. The scarier the selloff looks/feels the better. The key will be to ensure that during the climax of the sell-off that my timing signal remains bullish. If so it will be a great buying opportunity for those (like myself) who have missed out on the meat of this move.
Currencies look like the US Dollar could move higher with the Canadian Dollar at key resistance. This channel on the US Dollar isn’t a given at this point, but if the markets do sell off then it makes sense for the Dollar to rally….potentially back to the $81.50 level (which I’ve noted at R1). Resistance 2 would be near $83.
After breaking out of a wedge and nearly hitting resistance, I could see this moving back to the apex of the wedge near .9750, where it could find support and make a run at $1.01 again.