On The Fly: Weekly technical notes for S&P 500

The S&P 500 (SPX) hadn't done much over the last week, but perhaps saw its most siginficant technical event earlier today when the index broke below 2170. That level had become a support that wouldn't crack and now it has been taken out. If price remains below 2170, the next big test would come at the 2130 area. If that were broken on the downside, the bears might have their chance to get a larger correction going. If the 2170 area is retaken, notably closing above it today, then we would be back to a very narrow range of 2170 to just under the 2200 area. Traders should take note of the bump higher in the CBOE Volatility Index (VIX), which may be signaling more downside to come.