A lot of long term level rejections today, so it was rather pleasant to have taken major defensive action yesterday by significantly reducing longs and adding to UVXY hedge. 

So now the question - what is the correct exposure? When to lift hedges and add back more long? As usual I am assessing day by day. Let's consider:

All USA mains above all pivots; with sharply rising moving averages
Some other levels appeared to act as support like DIA 1HR1 and IWM Q1R1

SPX/SPY: Back under YR1 resistance
NDX/QQQ: Back under YR1 resistance
INDU/DIA: YR1 rejection
RUT/IWM: Lower from near YR1 tag
NYA & VTI: YR1 rejections

VIX: Above all pivots, 2 days outside daily Bollinger band, above Q1R1
XIV: Came back to close above Q1P and JanP; still above all pivots

Despite all the negatives listed, I cannot be too bearish with all the USA main indexes above all pivots. That said, I don't mess around with VIX moves like this combined with multiple YR1 rejections.

The XIV strength is quite pesky because a close under the Q1P would be been so clearly more bearish. So think best decision was to reduce UVXY; however, with all the yearly YR1s in play and VIX above all pivots it is still time to be cautious.

Best guess from here is some limited bounce, then lower. 

PS: Oil YR1 rejection too, and short mentioned last week making up for earlier attempt that didn't work. 

SPY, DIA, VIX and XIV below.