The proposed rising wedge pattern is still alive, but price would need to get above 1852.91 today for it to work, in my opinion.
If price gets below yesterday's low at 1840.19 things could get complicated. Another pattern could then take over. Such is the market.
The big three in Europe -- France, Germany, and the UK -- are down today. Not sure if that is an early warning for us, but as always it pays to be open to anything.
As for positioning, I continue to use only UVXY, buying lows and selling rallies trying to keep my basis as low as possible while always having a little bit "on." For the scenario that I'm currently envisioning, I would not touch a call spread on any VIX product, even though IV on UVXY calls is absolutely sky high at around 123%. That's nuts, but it's not something that I would want to short by employing a call spread if what I think could happen actually does happen.
The resolution of a large rising wedge would cause a significant volatility event. The VIX could possibly far surpass the recent 21.48 level. Option sellers would get toasted.
Actually, I think 2014 could be the year vol comes back big. I don't like to sell vol in the low teens, even though others may do well at it. I want to position NOW for a long vol explosion then add selling strategies LATER once vol has become elevated. That, in my opinion, is the time to sell vol. After the damage is done.