I'm working with 3 scenarios at this juncture:
1) the S&P fails in this area (possibly next week), rolls over, and targets the 950-850 area.
2) the S&P exceeds the August highs, and targets roughly the 1150-1175 area before rolling over.
3) the S&P put in a b-wave bottom at the August lows and is in wave 3 of a c-wave to new highs in the 1300+ range. This would mean the S&P completed an a-wave high in April which would bring my analysis back full-circle to the post from May entitled What If It's A B Wave? The one thing I would add to the analysis is that the Yen has strengthened considerably since the April highs, which should be cause for concern by the bulls.
I was wrong in looking for more new lows in July. I was just making a silly market call while misreading the wave structure. But I am slowly adding to my VXX position again, regardless of which of the above scenarios plays out. I do not care what the so-called options gurus say about this instrument. They were too busy poking fun at it in April when it rallied 100%.
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