Market cheerleaders see a rally coming; Mr. VIX is issuing a sell signal. Looks like the next few days will be a grudge match between Santa and Mr. VIX.
Everybody wants a Santa rally in stocks: Wall Street, the financial media cheerleaders, mutal fund managers, politicos, pump-and-dumpers, retail investors, gamblers, grifters and even Mrs. Santa all want a year-end stock market rally.
Santa's willing, but he's going to have to get past Mr. VIX.
The VIX volatility index is a remarkably accurate indicator of market highs and lows. You can see how well extremes in the VIX line up with highs and lows in the S&P 500 in the charts below.
I've marked the "Highs/Sells" in red lines and the "Lows/Buys" in black lines.