Commitment Of Traders, Futures And Hedge Fund Positions, Sunday Jan. 24

That said, bulls probably were not happy how Intel (INTC), IBM (IBM) and Seagate (STX) were treated post-earnings on Friday.

Nearest support on Nasdaq 100 (13366.40) lies at 13000.

Russell 2000 mini-index: Currently net long 449, down 14.6k.

Small-cap bulls were simply not ready to lose the 10-day on the Russell 2000 (2168.76). The average was breached intraday Friday but was aggressively bought.

Amidst this, increasingly it feels like some level of profit-taking is taking place, which at this stage of the game is normal. The index more than doubled from last March.

Immediately ahead, there is support at 2110s, and at 2020s after that.

US Dollar Index: Currently net short 14.3k, up 370.

Dollar bulls ran out of steam. After bottoming intraday at 89.17 on the 6th, the US dollar index (90.21) quickly rallied toward horizontal resistance at 90.50s. After several unsuccessful attempts, bulls now probably need to regroup.

From their perspective, the good thing is that they have managed to defend 88-89, which goes back to at least March 2004. Dynamics change if this level is breached.

VIX: Currently net short 124.5k, up 6.9k.

VIX (21.91) closed under a rising trend line from late November on Thursday but only to reclaim it on Friday, but barely. Thursday’s intraday low of 21.09 was yet another instance since late November of a successful test of 20-21.

From volatility bulls’ perspective, the problem has been their inability in recent weeks to sustain above mid-20s. That said, the consolation is that the 50-day is no longer dropping, rather trying to go sideways.

In the meantime, calls continue to exceed puts by a wide margin. The 10-day average of the CBOE equity-only put-to-call ratio on Wednesday made a fresh low of 0.388. Historically, the ratio tended to bottom in the low-0.50s, and high-0.40s occasionally. This time around, it has persistently remained in the 0.40s since November 13, eight of them in the 0.30s, including Wednesday through Friday this week (chart here). Optimism is dangerously lop-sided.

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