Doesn't look as though options traders are pricing in a stock market implosion: as we've made fresh lows in the major stock indexes, we've seen declining highs in VIX.
Meanwhile, at .69 and .67, the CBOE put/call ratios for the past two sessions have been above average, but not at highly bearish extremes.
New 20-day lows continue to hover in the 2000 area, which says that bounces are not lifting many boats.
If we cannot punish the shorts soon with a rally that bursts the important resistance in the low 1100 area of ES, I'd look for a washout below today's overnight lows. I generally like the bull side and find it historically profitable to fade weakness. My memories of 2008 have not altogether faded, however, and I recall when bullish setups based on market weakness failed, one after another.
Hence the caution amidst signs that we're not seeing panic.
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