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VIX

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Yatagan
Frequent Contributor
Yesterday, the VIX in the US spiked at 39.25 but then retraced and closed at 32.0 How reliable an indicator is this? Can one assume that the retracement indicated that the bottom had been reached?
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5 REPLIES 5
sponono
Super Contributor
16 March the VIX hits a high of 31.28 (RSI 73.03 very overbought) and the ALSI drops to 30,000. Yesterday the VIX gets close to 40 and the ALSI closes below 30,000. The vix has closed at 32 (above the 16 March high, RSI 73.45 very overbought) and the ALSI closes below 30,000. Go figure. http://bigcharts.marketwatch.com/interchart/interchart.asp?symb=vix&insttype=Index&time=10&freq=1
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barry_1
Super Contributor
I visit the VIX site every trading morning on Yahoo.Although its historical i find its a very good indicator of which way the US market is moving. compare it with the DOW and S&P which is possible and then U will see its a indicator over six months and also a year.
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sponono
Super Contributor
looks like resistance is now at 48
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Not applicable
in what way can you use it as a directional indicator? It is a volatility index, so not so sure I understand how you gauge direction out of it?
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barry_1
Super Contributor
Well at least it gives an indication of nervousness.While its spiking upwards and its above 25 we stay away from Calls and take Puts.When it falls straight down for at least two days then with other indicators and nervous is receding then we feel better at chancing Longs again
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