Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Technical Analysis With Charts -- Ignore unavailable to you. Want to Upgrade?

To: pcyhuang who wrote (3200)	10/26/2006 1:00:33 AM
From: jaker	Read Replies (1) \| Respond to of 6865

I am not very good with the ratio, so thought I would plot the $VIX.... basically it looks like extreme complacency... How long it can stay there, I dunno. h1.ripway.com

To: pcyhuang who wrote (3200)	10/26/2006 11:02:47 AM
From: Return to Sender	Read Replies (1) \| Respond to of 6865

I know one thing about the volatility indices. You cannot form a true long term market bottom without a huge spike in fear. That means that while the market can continue on higher with low volatility readings indefintely, as it has done now for years, that eventually people will sell stocks in an extreme panic again. It means that we have not had a true major bottom since October 2002. The low volatility readings reflect something that the bond market is not which is faith that the economy is on track for a soft landing. If and when it becomes clear that there will be no soft landing the volatilty indices will rise significantly. If we do get a soft landing then that will not happen at least until we have a major shock. But it will happen again. No period of complacency or fear can last forever. Keep in mind that when fear does rise that the first spike higher for the VIX may not be the last. It took over 2 1/2 years from the market top in 2000 to hit the market bottom in 2002. VIX, VXO and VXN on 6 Month Charts versus the S&P 500, DJIA, NASDAQ and SMH: 3 Year Weekly Charts

To: pcyhuang who wrote (3200)	10/26/2006 12:56:31 PM
From: MACD X	Respond to of 6865

Pcyhuang, we are were we were on the vix. stockcharts.com The volitility index means different things to different people, but what I think it means is like all thing in the market, there is exactly two different ways of looking at it. A bullish and a bearish way. I agree that volitility will rise and probably sooner than later, but if the market will fall as volitility rises isnt a proven fact. And if history repeats its self they will both rise together. It happened in the past and may also happen again. I think when volitility reaches 20 is a strong resistance area and may turn back any market down fall. No two market situations are the same, but on thing for sure that are to many bears for a significant market decline. Everyone is waiting on the election thinking the market may decline then when in reality it will probably kick into high gear. Its what is not expected, the market will fool the majority most of the time.