Weekly Wrap

We are witnessing some profiting taking, and for now there's your pattern structure for risk-off markets. VIX also remains in a newly bullish pattern breaking a downtrend structure (although a very weak break and still very early to tell if anything real materializes) but nonetheless a clear break. We are long VIX here, short YM. We suspect trading will remain very choppy into the holidays and any upside break away from this structure could easily turn into a fake out, but this provides the guidelines for now. The behavior is clearly structuring some type of short term top, but buying pressure really still remains heavily in control. Tread water lightly playing downside.