Volatilitiy (VIX) 8 day pattern analysis - update
Update on where the S&P 500 volatility (VIX) stands relative to its 8 day pattern. If the pattern holds, then today should be a peak in the markets followed by 2 down days. All the numbers over the past several days line up with the pattern. I marked days 2 and 5. You can see that they are almost the exact same % drop as in the past several cycles. Yesterday looks about the same also.
If the pattern holds, then one thing that is apparent is that the VIX is leveling off, which is still way above a normal/safe market. I know it does not feel like it when you look at the recent highs in the market, but the VIX seems to be indicating something different. What the VIX generally indicates is that it rises when prices fall and goes down when prices go up. What is interesting is that given the recent sustained highs in the market, it is actually going down less than previously. I am not sure exactly what that means. Does it mean a reversal is on the horizon? Hard to believe given that the market is up so much. However, maybe this is a case of "Fearful when others are greedy and greedy when others are fearful"??? I find it interesting that it would line up well with my though on this being a Wyckoff UTAD event (see related ideas). Only time will tell.
Hope it helps.
If the pattern holds, then one thing that is apparent is that the VIX is leveling off, which is still way above a normal/safe market. I know it does not feel like it when you look at the recent highs in the market, but the VIX seems to be indicating something different. What the VIX generally indicates is that it rises when prices fall and goes down when prices go up. What is interesting is that given the recent sustained highs in the market, it is actually going down less than previously. I am not sure exactly what that means. Does it mean a reversal is on the horizon? Hard to believe given that the market is up so much. However, maybe this is a case of "Fearful when others are greedy and greedy when others are fearful"??? I find it interesting that it would line up well with my though on this being a Wyckoff UTAD event (see related ideas). Only time will tell.
Hope it helps.
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