Tuesday, April 6, 2010

VIX Is As High As It Was In May 08, Oct 07

at 16.23.

Take a look at the chart. The Volatility Index landed on some sort of support line from October 2007, when Dow and S&P hit their respective top. May 2008 was a minor top, from which the decline started that led to the crash in October that year.

Does this indicate we are again at a top? I don't know. The index could simply dip under this seeming support line and go back to the pre-crisis (before August 2007, when subprime mortgage crisis started to hit the fan) level of low teens (as if the crisis is over...).

Many analysts, traders have been saying that the rally since March 2009 is getting too long in the tooth. But then, I believe many of them have been saying that since July 2007.

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