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Strategies & Market Trends : John Pitera's Market Laboratory
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To: isopatch who wrote (17245)9/21/2015 1:18:44 PM
From: The Ox  Read Replies (1) of 33421
 
Really? Do they really believe the headline?

VIX Manipulation Runs The Entire Market


What a joke.

Yes, there are aspects to the article that are very true. The rise in VIX based trading vehicles will lead to more extreme moves, IMO. No doubt that the computer algos and traders are all looking at the same thing and that will tend to reinforce the trend...to somewhat larger extremes.

To say that this rise in VIX products alone is responsible for these extremes is the tail wagging the dog, as far as I see it. Makes me wonder if the author(s) weren't whiplashed by the movements in these vehicles?

We had VIX readings that stayed low for months, due to the market (basically) going sideways for 3/4s of a year. We ended up with the "coiled spring" in VIX related products. So when the market tanked in a hurry, VIX exploded upward. That's the nature of the product, not some conspiracy....as I see it.

This was written in April, so we had over 4 more months of sideways action afterwards:

From: The Ox4/13/2015 12:22:50 PM
To: Fintas who wrote (16925) Read Replies (1) of 17246
I would say the odds of VIX falling to 8 are low but it's possible. Below 10 is unlikely but there is a recent low in the mid 10s that could be tested and possibly fail if the market starts making new highs and tries to make a full blow breakout in the major indexes. With many months of chop and sideways action, a blue sky breakout is very much a possibility with a supportive earnings season. Then we'll see if the sideways action morphs into a new run up.....
Never say never, so 8 is possible but I think unlikely without a huge rally.
We all know that the market DID NOT rally and blast upward.
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