VIX Up 37% While SPX Is Flat, House Of Cards Or House Of Fear?

 

 

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Do some investors think the market is a "House of Cards?" Humbly I don't know. It sure seems like something has them concerned, as fear levels remain lofty with the market making little progress up or down!

Over the past 90-days the S&P 500 (SPY) is pretty much flat (up less than 1%). During that time the VIX (Fear Index) remains elevated, as it been up the majority of the time the market has been going sideways.

 

 

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The VIX looks to be creating a pennant pattern over the past few months. How this pattern resolves itself could point to which direction SPY heads from out of this sideways chop.

 

 

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This table highlights what happens to the VIX after its up 40% in 90-days when SPY is positive. Majority of the time 90-days out the VIX is lower.

Falling fear can be positive for stocks and for XIV, lets see what happens from here!