Context for all the VIX hype
(Plus a gold & silver update)
SD Exclusive: Much has been said about the VIX lately, especially surging over 44% today alone. How about a little perspective though? There are two issues that signal this stock market is going higher.
First, VIX is already in extreme territory of over 80 on the RSI. Technical analysis would say the move is pretty much done for now. Look at the last two events, President Trump and Brexit. The RSI is higher today than it was during either of those events:
Now, nuclear war doesn’t have anything on four years or breaking up with the European Union. However, how much higher can “fear” surge on the Relative Strength Index? Not much. And to put that into perspective, there’s this:
Secondly, that’s the VIX and the Dow. The chart pretty much speaks for itself. The August 24th “crash” of 2015 was showing a VIX above 50, and today, well, we’re above 16. Also. The Dow is over 7,000 points higher that it was in 2015 on that Black Monday 2.0. How far is it gonna fall with VIX running out of steam.
There is either going to be a massive, major blow-off top, or, the stock market could be poised for a massive “rip-your-face-off” power surge to the upside that blows recent surges out of the water. We’ll see, but if I we’re thinking the stock market was ready to crash right here and right now, now might not be a good time to be buyin’ up a bunch of put options.
And for our metals? Well, gold and silver have room to run. The precious metals are not overbought, and they are looking strong:
I wouldn’t get my hopes up for $1300 tomorrow, or even $17.50, because how this year has unfolded, and tomorrow will most likely be a bunch of “meh” in the markets overall. But then again, well just see how Europe and Asia pan out.
It is not, out of possibility, however, that we could see a surge in silver. Last year at this time, when silver was peaking out before getting smashed back into oblivion, the white metal was $20.50. So even on price we have a way to run. Gold too. With the Brexit surge and the Trump surge (before the smash), a $50 to $100 in the yellow metal might be coming at any moment. But like I said, I’m not gettin’ my hopes up.
I guess will just have to wait and see how the whole North Korea thing is working itself out, and I could be and probably am WAY off-base, but, I wouldn’t want to be caught in new short positions on anything in stocks right now. Even if DB, SNAP, APRN, are SNAFU.
As per tradition, we will be out with our Friday Market Wrap and SD Weekly Metals and Markets, and they are both gonna have an extra heaping of awesome this week.