EB Daily Market Report - Monday, January 24, 2022

This is going to be very brief. I'll be discussing market issues and charts later today during our Q1 Earnings webinar. Right now, I just want you to be aware of the fact that the Volatility Index ($VIX) has approached 38. This is a level where significant reversals have occurred in the past. Over the past 15 years, the VIX at this level has a solid track record of producing swift bullish reversals. For those interested in short-term trades (with plenty of risk), now is at least a time to be thinking about taking positions. Trading ETFs vs. individual stocks will cut into potential return, but also will provide a bit more safety - although with a VIX in the upper 30s, not a whole lot should be considered safe.

Here's the current chart of the S&P 500, with the VIX below it:

We're hitting key support near 4300 and the VIX hit 38. Taking a shot on the long side here makes sense for those that are willing to accept high risk for the potential of high reward.

If we fail to hold 4300 on the close, then we could have further short-term issues. I'm banking on a short-term reversal here, however. We'll know later today and we'll talk about it this afternoon. Here's today room link (room will open at 4:00pm ET)

https://earningsbeats.zoom.us/j/81570556674

Tom