Update On The Volatility Index, VIX

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Update On The Volatility Index, VIX

By John Lee on September 28, 2008 | More Posts By John Lee | Author's Website

I want to point out the significance of the VIX (^VIX) at the stage it’s in. THe VIX is actually consolidating in a high-and-tight flag pattern. If you check the past 3-years, you’ll see that the VIX has never done this. This means that the fear is still at elevated levels and probably won’t be coming back down anytime soon. This pattern indicates that a breakout higher should occur imminently.

But, the bailout could change all of this and the flag pattern could breakdown, sending the VIX into the 20s, but I doubt it. Note any bounce off the 15-day MA.

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