VIX Volatility Daily Chart

Federal Reserve Chairman Powell placed his jackboot on the throat of volatility yesterday and voila, stocks rise. The VIX drops, so stocks pop. A key test was several days ago when the VIX came up to test the 200-day MA, a key bull-bear line in the sand, and was spanked back down. A ST (short-term) bull market is in play when the VIX is below the 200-day MA while a bear market is in play if the VIX is above the 200.

The Keybot the Quant algorithm is currently long and tracking VIX 27.16 as the key bull-bear line in the sand. The stock market rally will end if the VIX moves above 27.16. The VIX is at 26.00 with S&P futures up +14. Thus, the bulls are celebrating unless the bears can push the VIX up a point and more.

Mixing it all together, if the VIX remains below 27.16, the stock market remains in party mode rocking and rolling higher. Between 27.16 and 29.97, stocks will no longer move higher but instead move sideways to sideways lower. Above 29.97, the wheels fall off the stock market bus with equities falling in earnest. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Note Added 7:37 AM EST: VIX 25.90. S&P +17.

Note Added 8:45 AM EST: VIX 25.73. S&P +17. The flash crashes and spikes are occurring again like yesterday around this time. VIX drops from 25.83 to 24.05 and then rebounds to 25.38 in 2 minutes time and then 25.73.

Note Added 9:00 AM EST: VIX 24.03. S&P +21. Wheee! Whoopie! Wheee! Jam that vol lower; the wealthy class must be protected. The top 1% wealthiest Americans own 50% of the US stocks. The top 10% wealthiest Americans own 88% (almost 90%) of the US stock market. One-half of America does not own one single share of stock. No wonder crony capitalism is crumbling.

Note Added 9:15 AM EST: VIX 25.47. S&P +22. The VIX is bouncing around like a ping-pong ball.

Note Added 11:17 AM EST: The VIX drops to 25.17 teasing the late August prices all morning long. Volatility will have to bounce or die from this critical support area. SPX 3467..