VIX Volatility Daily Chart

The VIX daily chart shows a 14 handle which means traders are complacent, fearless, and believe that the markets will not drop.  As last week's VIX weekly chart clearly shows (type 'VIX' in the search box above to locate that chart), all significant market tops over the last two years have been identified by a VIX at 14-15. The falling wedges, overbot stochastics and positive divergence (green lines) hint at a bounce coming. Higher VIX means lower equity markets.

Price is very close to the March lows so a test of that level would be expected.  The short red lines show that there is some VST downside momo, thus, a bounce would satisfy the falling wedges and positive divergence in the near term, and then perhaps a double bottom forms, then more upside. The indicators were long and strong and peaked with the VIX 21 print in July so the chart favors another look at that level. The 14 handle on the VIX favors a short term bounce, as well as a more significant move upwards on tap in the days and weeks ahead, which would correlate to a significant broad market top now forming. 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.