Looking back on last Wednesday VIX Ponzo chart....that green outlier line proven frightfully correct, only missing the peak by 2%. But now. cooler heads have apparently prevailed as undercurrent comments from the FED portray a likely dovish stance in September and the markets responded accordingly. Going forward the SPY outlook has turned bullish, the VIX looks poised to fall back into a narrow channel and TLT...well, TLT is a bit of a problem child, torn between the effects of rising yields versus the HUGE international positions anxious to protect their investment.
As a result, the TLT trend is the most difficult of our little basket to project technically. Maybe next week will shed a better light on TLT's prospects which saw massive swings in today's trading.