Keystone's SPX:VIX Ratio Indicator Daily Chart

The 68 is a key signal line for the SPX:VIX ratio.  The red circles verify that a large market selling event is at hand, in progress, or imminent, and a triple digit down day for the Dow Industrials would be expected. At the least, the bears growl strongly when the 68 level fails.  The green circle is the opposite move. As price moves up and over 68 that triggers bull happiness and large up days for the broad indexes.

Note how Tuesday shows the sub 68 drop that ushered in the large market selling, but then recovered on Wednesday to provide the bulls the all-clear signal once again.  At 76 now, the bulls are happy as can be, no fears or worries, well above the danger level at 68.  This is a daily chart, you must reference the real-time chart during trading hours since that will tell you the exact time the 68 level fails and thus verify that an extensive market down move is in progress and the short side is favored.

If you remember fractions from high school, hopefully you were not sitting in the back of the room goofing off, you know that the upper number moving up in the ratio (SPX), will cause the number to move higher, but the lower number moving up in the ratio (VIX), will cause the number to move lower. So watch volatility closely. As the VIX rockets higher, that action will lower the ratio and take it down towards the 68 level. The low volatility these days shows the complacency in place by bullish traders, no fear or worries, the VIX stays low so the SPX:VIX ratio stays elevated.  Once fear comes into the markets, and rest assured, fear will come in at some point, the VIX will spike, the ratio will drop under 68, and you will know the bull fun has come to an end. 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. Reference the Market Turn Signals page for more information.