NEW YORK ( TheStreet) -- The summer is coming to an end, which means we are on the last leg of light trading volumes and uncertainty over monetary policy.
As close as we are to the end, we are not in the clear just yet. The Federal Reserve meetings don't start for another few weeks, which means investors are left filling the information void by trading on perception rather than hard facts.
The lack of clarity has pushed volatility higher and led to a multiweek downturn in U.S. equities. The SPDR S&P 500 (SPY) seen below shows a break lower after consolidation at record highs, but the market has since stabilized.
Lighter volumes will continue to exaggerate price swings, and with both durable goods and Gross Domestic Product numbers out this week, extreme readings in either direction could cause large moves to the downside.(VXX) The VIX sits at elevated levels, but it still looks to have room for a move higher if markets react negatively to economic data this week. Expect volatility to continue in an upward trend.