$SPX dropped over 5% since last week’s highs in what seemed like a straight line down, down 6 days in a row with any rally attempt sold into. A vicious decline that blew through levels, patterns, support lines without barely a pause.

The sky was falling. Or was it? Actually, if you view the action through another, perhaps simpler lens, markets concluded some unfinished business: The filling of gaps.

4 specific ones actually: 2 on $SPX and 2 on $VIX. The ones left behind by the even steeper rally off of the October lows.

Indeed today’s intraday low on $SPX coincided precisely with the filling of the final $VIX gap:

Gaps matter. Not all gaps fill, sometimes they take months or even years to fill. But a cluster of gaps in short order have a way of seeing most of them filled.

And so perhaps that’s a message to be pondered as one looks at the latest $NDX chart here:

That’s a lot of unfilled gaps. Just saying.

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Authored by: Sven Henrich