On Monday we noted that while the market was getting skittish and the VIX was up 17%, the VIX had done nothing, as far as indicating a bearish phase was concerned. We noted a downtrend channel on the VIX daily chart. Ref. Here is What to Watch on the VIX
You’ve got to tune out the daily whipsaws, and sure enough, the VIX reversed back down as the market parties on with Garth and Wayne going into the weekend.
Here is the weekly view of the VIX in its downtrend channel, similar to the one in 2015 that formed as the S&P 500 was making the most lovely topping pattern (that wasn’t).
We have been operating to a target of 2410 on the S&P 500 since the topping pattern was negated on the post-Brexit rebound and thrust last summer. That is a target, not a directive. But it seems to line up well with our ‘by March/April’ view for the end of this bull phase. The VIX appears on board with that theme as well.
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