Saturday, January 21, 2012

VIX - Bottomed

Last weekend it was suggested that the VIX had a little more to decline.  It did decline, and now the geometry lines up beautifully for a bottom. 

The VIX is much lower than in late October.  In contrast, SPX is barely higher than the late October high at 1292.  This is a very bearish combination with the market hardly advancing in 3 months, and a VIX that has collapsed. 

Complacency is at an extreme.  The target for VIX is over 60.

Daily Chart



  1. Target for vix over 60?

    So another crash call for the market?

  2. Yes, that is correct it is already confirmed in my symmetrical pattern ckorey. I know what I see, and yes, it is definitely setting up. The probability is 100% from my work.

    I have not announced the timing and setup yet, but will be soon.

    On Friday I went long VIX futures via TVIX at $20.21 with a large position. This is a trade with $28.80 area being a short term target around Jan 30-31.

  3. The COT report this week shows the Commercials (smart money) have been getting net short the past couple of weeks. That going to line up with SC's prediction that when they decide to sell, there won't be support that holds the markets up anytime soon.

  4. SC,

    I commend you for your courage and sticking your neck out with your analysis. It shows your dedication to your work. Many TA blogs I read show the same falling wedge of the VIX that is nearing its apex. A bounce it imminent. After the bounce maybe to 24, do you see it drop to a lower low than 18.5 first before shooting to 60?? or do you think this is THE bottom and we won't see it for awhile? Do you think we see 60 first before we see 18 again?

  5. I do think that this is the bottom for VIX. VIX is ready for a spike up into the mid 20's over the next week or so. Then I see it settling back down again putting in a higher low early Feb.

    It will take time to reach 60's. A spike for the VIX up to 60's can be justified with only one work. Not "Europe", but rather "Lehman"....

    Now I will surely be accused of fear mongering. The reality is that the market has already spoken.