Billy Boy, guess what????
I just went to the mail box?, and low and behold Bernies Newsletter...
And guess what again??? My Dear Friend, Bernie talks about the very thing we have been yappin' about for days,,The Ole VIX & OEX correlation...
I'm going to post this exact paragraph verbatim, it's small, and Bill I'm counting on you and others with technical know how to track this damn thing for us all...I'm just to unsophisticated with TA to know what the hell i'm doin'<gggg>>
Here goes...
" In addition to the equity put/call ratio we mentioned LAST MONTH!!! AH! HA!:>}..another sentiment measure that provides VERY ACCURATE short=term forecasts of the stock market is the CBOE-VIX INDEX...The VIX is a measure of the volatility, or PREMIUM, priced into the S&P 100 Index (OEX)...(Bill i did not know this)...What we have found is that very fast spikes in this index to exteamly high levels tend to mark SHORT-TERM MARKET BOTTOMS....
A way to measure these spikes in the VIX is to use Bollinger Bands.. This method involves drawing "bands" two population standard deviations above and below a moving avaerage of the DATA.....
A break above the TOP Band indicates a relative HIGH in the VIX, suggesting a market bottom is in place. Last Friday, DEC 12th, the VIX closed at 29.14 and broke the upper BB of its 10-day mva, which we view bullishly for the ensuing 2 weeks....""""
Now Bill this is exactly what I was talking about...We have here and now some measure to guide us in market direction..Obviously we can not use it alone, but it worked recently last month and it looks like it will again...I HOPE.....
Would someone with brains and tech knowhow track this index for us at all times...we can play the market both ways, and at least have a feel based on this info...
Whew!!! that was a lot for me Billy, but BOY O' BOY I HOPE HE'S RIGHT..
Later Jerry |
