Day two of the government shutdown is now in the books, and it looks like we'll at least get a third day of the same, judging from the way things are going (or not going) in Washington. Though the bulls didn't follow through on yesterday's rally, it's not like stocks were hammered due to another day of shuttered government doors. Mostly it looks like traders don't really care about the shutdown either way, which - to put it bluntly - is the way it should be. There's no real empirical evidence that these shutdowns adversely impact the economy, so investors have decided to proceed as if it's not even happening. Be that as it may, though volume was light again on Wednesday and stocks haven't really gone anywhere (on a net basis) since Friday, there's something of a red flag waving in the background I don't think we can afford to ignore. What's that? The CBOE Volatility Index, or the VIX for short. We talk about it from time to time, but just to make sure we're all as versed as we need to be when I lower the proverbial boom, the VIX is in many ways a fear gauge. This kind of sentiment tool is useful for traders like you and me because it tells us how traders are feeling, and what traders are planning for in the foreseeable future with their dollars. And that's a detail that can't be underscored enough. While stocks as well as the media can send mixed messages - if not downright errant messages - the VIX shows you what real traders are thinking by telling you what these traders are actually doing with their money. Ever heard the phrase "Do as I do, not as I say"? The market itself is a reflection of what most people are saying. The VIX, however, is a measure of what people are actually doing. That's why I trust the VIX waaayyyyy more than I trust the market's indexes. Anyway, care to guess what little indicator told us traders are leaning more and more bearishly, even if the market seems to be holding steady? Yep, the VIX is chugging along, having renewed an uptrend - a sign of increasing fear and worry - that was jump-started back on September 20th. No need to describe it to you when I can just show you the chart. As you can see, the CBOE Volatility Index is still pushing into and above its upper Bollinger band, much like it did when stocks were falling in August, and much like it did when stocks were falling in late May and early June. Does this absolutely mean it's only a matter of time before the S&P 500 breaks down to mirror the VIX's upward move? No, there are never any outright certainties in the market. But, from an odds-making perspective, the fact that the VIX is rising doesn't exactly bode bullishly for stocks in the short run. That being said, I'm not surprised in the least how the S&P 500 Index wedged itself under the resistance of its 20-day moving average line, but above the support of its 50-day moving average line. A lot of traders don't know what to do here, and/or don't want to do anything until the government shutdown has been lifted. I can't say I blame them. Again though, while the market itself may be on hold for a while until government offices are re-opened, we're going to have to play the hand we've been dealt when that time comes. The VIX says the hand is increasingly bearish, which could prove to be a problem for stocks once things are back to "normal." Add it to the list of things we'll be watching closely this week and next week. I know "wait and see" isn't the most riveting of trading tips, but take it from a guy who's been around the block more times than he cares to admit - the current scenario isn't one with anywhere near enough certainty to try and force a market-wide trade. The trading opportunities WILL be there (and soon). For the time being though, we really are caught between a rock and a hard place, and stocks seem content to stay right there until further notice. The same can't be said for individual stocks, however, and for whatever reason we got a ton of stock-based ideas and commentaries at the site today. From the Site If you can't find an actionable idea at the SCN website today, then you're just not trying. There's a lot more than this, but here's an appetizer of Wednesday's best write-ups at the site: When someone thinks of a government raid, the last thing image they conjure up is the United States Fish and Wildlife Service storming a building in search of, well, anything. Most investors would be surprised to hear our Fish and Wildlife department even has the ability to perform a raid. That's exactly what happened, however, when the federal government agency - one that clearly didn't shut down - decided to target Lumber Liquidators (LL). Aside from being one of those great "huh?" stories, John Udovich's Lumber Liquidators Holdings: Is Rush Limbaugh's Flooring Stock a Buy? article takes an opportunistic look at the situation. And, while rare earth mania will likely never return to its 2010 glory days, this now-mostly-shelved industry has wiggled its way back to relevance. James Brumley has been following the saga of these stocks lately, and decided today that The Rare Earth Rebound Just Became Real. Here's the Best Way to Play. That's it for today, but don't forget earnings season is just around the corner - Alcoa (AA) announces on Tuesday, the 8th. We'll have a couple of key commentaries and projections for you between then and now.