S&P500 against VIX showing some bumpy road ahead

27 янв. 2023 г.

This is the S&P500 index (SPX) against the Volatility Index (VIX). We've charted VIX's Cycles since June 2020 where the bottoms are in essence alarms and signals to be on the look out to sell and take profits on stocks while the tops are buy signals to enter the market.

Based on that model, VIX appears to be entering the rising curve, meaning that a sell alarm is starting to ring. Given the fact that the price is approaching a Resistance level where it was rejected two times already, we may see a decent drop. If the drop isn't delivered and it was just the two day quick pull-back of January 18/19, then the Cycle pattern may start to invalidate the strong drops of the Bear Cycle and instead mimic the blue-print of the 2020 - 2021 small pull-backs. That would indicate that the Bear Cycle is over and that S&P500 has officially entered the new Bull Cycle.


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