Difficult moments continue. Interest rates need to come down sharply to tame the VIX beast. Oil has to rally to change the recession- after-rates-go up narrative. Everything is caught up in the thinly traded S&P futures.
It's a box we can't get out of until we get some weaker inflation data because every number, every data point, every earnings report is being viewed as ammo for rising rates.
Now, of course, there's the possibility that the big bond short has gotten too aggressive and if we get a benign CPI tomorrow then rates go to 2.7 and the VIX short busters are destroyed. We do rally with the stocks of companies that just reported good quarters leading the way.
And I do like the fact that the volume on the (TVIX) is lower. (And I wish the government would go after the manipulators and the CBO not defend all behavior including bad behavior, a totally ill-advised stance.)
But the possibility of the dreaded "retest" can't be taken off the table until rates retreat significantly and right now that's not happening.