Equity Indexes are a couple of points higher as we head into the close and the Holiday weekend. The S&P 500 (SPX) is up about 3 points on the week, trading at 2261 and essentially unchanged on the week.

Volatility continues to drain out of the market, with the short term historical volatility of the SPX down below 5 percent. The VIX is interestingly up fractionally today to 11.63, while the VXST, the 9-day Volatility Index, pushes down to 9.12. Part of that is the pricing in of the holidays in the volatility calculations, as they have to factor in that time decay.

As we have said before, volatility doesn’t stay ultra-low for long. Movement will come back into this market, and some of our traders think it will be as early as this coming week.

John is looking at the lack of volatility as well. “The markets have gone into hibernation as flocks of traders race to the malls for last minute Christmas shopping. I'm looking for this boringness to continue into next week but with a slight upward theme in stocks (Stock idea - NVDA is just getting started).”

Chris, on the other hand, thinks that the bull run is soon to end. “I think the end of next week will be sharply lower.”

Carolyn is a “cautious bull” despite knowing that such a creature doesn’t really exist. “This market is extended and in the position to correct to the downside. It's important to protect profits on longs at this point.”

Tony believes the only way to play the indices right now is “either long or flat”.

It looks to me that the market may be topping out. You don’t want to fight the tape, but… even if there is greater probability of the market continuing to push higher, that seems to be capped, at least for the time being. If we get a break to the downside it could be sharp, especially given the extreme levels of short volatility and lack of hedges. Therefore having some hedge and/or downside exposure in puts makes good sense at this juncture.

Happy Holidays to all of you from all of us!!!