Today the bearish developments of Monday continued, with one small change. Somehow, VIX closed under its DecP. I'd have more confidence in a significant down move ahead if VIX were moving higher - like above its Q4P again. Not yet. So it's possible that this is just a few day 'sell the news' move and USA main indexes again hold their monthly pivots and zoom back to higher. Possible.

One argument against the shallow dip is that TLT moved clearly above its YP today. How is TLT just a few points off its high of the year after a relentless 1 year stock rally? Typically, strength in safe havens means more volatility in risk assets.

Over the past several weeks, some of the hedging suggestions have been a bit frustrating. As i have mentioned several times, there were a few gains and a few small losses. But i did not relent on risk control and the next batch of short hedges has been a fantastic alpha move: short SMH and FXI near highs to lock in gains from 8/21 area buys; then short QQQ, and adding to QQQ. Potentially short others like SPY or IWM yesterday or adding on TLT long today. As I mentioned in yesterday's daily comment, it was time for action and now I am quite comfortable on this market drop.

If USA mains hold DecPs again I'll cover some shorts. But if more join QQQ below DecPs as VIX climbs, I'll hold.

SPY, QQQ, VIX and TLT below.