VIX Declining
The S&P500 Volatility Index(VIX) shows price testing the 78.6% Fib level near $28 and the first reading back below $30 since February. With the VIX below the 61.8% Fib retracement price is technically back in a bear trend and indicates that forward-volatility in the SPX is expected to dissipate. The VIX represents the market’s expectation of 30-day forward-looking volatility and is derived from price inputs of the S&P500 index options, and it provies a measure of market risk and investors’ sentiment. It is also known as the “Fear Guage” or “Fear Index”. The ideal level for the VIX to be trading during an uptrend in the SP500 is below $20 as a signal that no implied volatility is expected in stocks.
The Relative Strength Index(RSI) shows the green RSI line and purple signal line both declining below the 50 level which indicates bearish momentum in the VIX, or a continued decline in SP500 volatility.
The Price Percent Oscillator(PPO) shows the green PPO line and purple signal line both declining below the 0 level which indicates bearish momentum in the VIX.
The Average Directional Movement Index(ADX) shows the purple line rising above the green line which indicates a bearish trend in the VIX.
Overall, the VIX is showing that fear has subsided in the S&P500.
The Relative Strength Index(RSI) shows the green RSI line and purple signal line both declining below the 50 level which indicates bearish momentum in the VIX, or a continued decline in SP500 volatility.
The Price Percent Oscillator(PPO) shows the green PPO line and purple signal line both declining below the 0 level which indicates bearish momentum in the VIX.
The Average Directional Movement Index(ADX) shows the purple line rising above the green line which indicates a bearish trend in the VIX.
Overall, the VIX is showing that fear has subsided in the S&P500.
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