THE STRETCH

Checking the numbers, VIX/VXO in over bought territory but hardly stretched the way they were at the August lows when the VIX traded over 30 and about 20% above its 10 day SMA. Yesterday's close was under 29 and about 8% over the 10 day SMA. The Thanksgiving holiday probably kept a little lid on the VIX so not sure the difference is that significant.

The 50 day SMA on the SPX is a little different story. Back at the mid August lows, the SPX was about 7% below its 50 day and yesterday- right back at the 7% number so maybe deja vu all over again. Also, note on the chart, MACD Histogram and 14 day RSI making higher lows while the SPX index is making lower lows of late. Just another positive divergence and maybe a preview of something good to come.

One wierd one is the NH and NL list on the NYSE . On August 16, when the SPX traded down to 1,370, the New Low list on the NYSE was up at 1,132 while yesterday it was only at 308. We also had higher NL numbers last Monday and Tuesday at 546 and 613 respectively, so maybe a little positive divergence as the SPX made a lower low but the NL list made fewer NL's.