Here's a graph using 15 minute increments for the past 10 market days. The graph uses the CPC, CPCE and the VIX laid out against the S&P (SPX). Of the 8 buy-sell opportunities during the past 10 days, the CPC and CPCE failed twice as indicators, which is a 75% success ratio when predicting market direction. Notice the CPC and CPCE when used in conjunction gave more than adequate notice of a trend change. The VIX is a laggard, but provided verification in most circumstances.So what does this mean?
The graph shows the CPCE just went bullish at the end of the trading day on Thursday. The CPC is still bearish, but appears to be rounding to a top and might head down. The VIX is already bullish. Looking back at prior days, when the CPCE turned bullish just before the end of the trading day, it usually means the market will decline for the first hour - - to an hour and a half - - in the morning, then go bullish the rest of the day. This hasn't yet been confirmed by the CPC, so this will bear watching in the morning.
Once again, if prices rise to 875 tomorrow, it means the correction was shallow and is likely over. If the market falls to 825, then a larger correction is in store, likely down to at least 780 on the SPX.
I will post about an hour after the market open in the morning to provide guidance.
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