This market’s got a short memory.
Just a few days ago, we were staring at a 500+ point drop in the S&P… then after yesterday’s record rally, folks were acting like we’re out of the woods.
I wasn’t sure then and I’m definitely not sure now.
See, we kicked off the month of April at 5644 on the S&P futures — and within five trading days, we had dropped as low as 4832. That’s a massive 800+ point selloff. Big one.
Now we’ve bounced a bit, sure — but as I said in today’s Market Radar session, we’re still down on the month.
The way I see it, until we get back above that 5644 level, every rally is still suspect.
That’s the line I’m watching.
In fact, overnight, I was watching the S&P futures sell off and despite the huge record-breaking rally we had yesterday, I suspected — before US markets even opened — that today might be a red candle day.
See, I saw the S&P futures start fading during the overnight session — European markets weren’t looking great.
Price action looked shaky, and sure enough, we rolled over right at the 23.6% retracement, blew through the 38.2%, and landed at the 50%.
That’s where we bounced — but this kind of back-and-forth is exactly what I was talking about in yesterday’s newsletter, when I said “the whipsaws aren’t over yet.”
And the VIX backs that up.
In fact, the VXX — an ETF that tracks short-term VIX futures — recently spiked as high as 91, one of the sharpest volatility surges we’ve seen in ages.
Now it’s hanging in the 80s — not the place you want it if you’re trying to bet big on a long-term rally.
The 14-day average range on the S&P right now? 210 points. That’s up from 90 just two weeks ago.
200 and 300 point days are just not normal. This is a volatile market. And when that’s the case, I don’t chase green candles.
I stay sharp. I watch my levels. And I trade small, tight, and smart.
I just covered this — along with the key Fibonacci zones I’m watching and what I think comes next — in today’s Market Radar.
Watch the full session here — and don’t forget to join my FREE Telegram channel to get notified when I’m going live.
Stay sharp,
—Geof Smith
P.S. Have you seen this hot energy tip?
