3/11/22 Inflation Still High … Volatility Behind, Volatility Ahead

News:

New inflation numbers revealed inflation is still high … big surprise!

After gaping down, markets finished in the red yesterday. Though well off their lows and near session highs.

Russia claims to have enough buyers for its oil even after all the sanctions. Although life in Russia is very different than it was just a few weeks ago.

After several big banks ceased operations in the country Yahoo Finance put out a list of companies still doing business in Russia. Because that’s the shorter list.

The war began in 2014, but the escalation in 2022 was unpredictable.

The situation remains volatile and the markets will continue to watch it closely as it unfolds.

Russia has a population of about 150 million, and its GDP is about $1.5 trillion. Landing its economy between Italy and Spain. For some reference, the US population is roughly double Russia’s but the GDP is about $21 trillion.

Technicals:

Most indicators remain neutral. The market is free to move in the path of least resistance.

This morning’s chart is the VIX, the volatility index. Its historical average is about 20. Above that favors the bears, below that favors the bulls.

VIX Daily Candles – Chart via thinkorswim

The chart shows a clear uptrend with resistance in the 35 area. Bears are in charge.

For the short-term bottom, I called earlier this week to hold the VIX will need to stay below 35. It’s showing signs of reversing but the uptrend is strong.

I’ll be watching this indicator closely in the week ahead.

Timing:

It’s Friday, the market may be hesitant to take much risk over the weekend given the fluid situation in Ukraine.

Next week is the FOMC and the week will finish with a triple witching. Both events are known to bring extra volatility to the market.

Watch the VIX and stay safe.

Watchlist:

*Low Float
^Open Position

*ICD is on watch
*SGLY has resistance at $8
*METC has support at $20
EBIX has support at $40
CVI is on watch
HDSN is on watch
AMPY has support at $6
VYGR has support at $6
WHD has support at $55
^FTK has resistance at $1.80
LNTH has resistance at $53
PBF has resistance at $25
^CTIC has support at $4.50
LXU has support at $20
FLR has resistance at $28

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