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Russell 2000 Volatility Index Hits Record Lows: Trouble Ahead?

Small-Cap volatility expectations just smashed previous record lows. I’ve written a fair amount lately on various themes related to volatility expectations in the stock market. Many of these posts focused on the behavior of volatility expectations relative to their underlying stock market indices, including one last week on the “stand-off” between the Russell…

Is Market Uncertainty Showing Signs Of Complacency?

There are several ways to process, measure, and analyze market uncertainty. Today we’ll look at two charts that show investors uncertainty through different lenses:  One focused on economic uncertainty, the other focused on the VIX Volatility Index (INDEXCBOE:VIX). The first chart looks at the global trend in uncertainty related to…

Stocks Rebound But Volatility Shakes Investor Confidence

The equity markets rallied last week breaking a two-week losing streak. The S&P 500 (INDEXSP:.INX) and Dow Jones Industrials (INDEXDJX:.DJI) gained 0.7% while the Russell 2000 Index climbed 1.45%. Investors have seen an uptick in stock market volatility (INDEXCBOE:VIX) in August. And from the early action this week, that news…

Stock Market Volatility Index (VIX) Surges as RSI Tops 80

After periods of extreme complacency, we are often met with times of severe reversals. This has been the case for the VIX Volatility Index () which is often called the “fear gauge” over the course of the last several years. This morning, the Relative Strength Index (RSI) on the VIX…

Stock Market Update: Short-Term Pain, Long-Term Gain?

The second straight quarter of double-digit profit growth has supported the Dow Industrial Average (INDEXDJX:.DJI) move to new highs. Broader-based indices including the S&P 500 (INDEXSP:.INX) and Russell 2000 (INDEXRUSSELL:RUT) haven’t been able to keep pace but are holding up. The jobs report on Friday easily beat expectations. The unemployment…

Using The $VXST To $VIX Ratio For Shorting $VXX

Recap:In our first article we examined the ratio of the CBOE VXST Short-term Volatility Index (INDEXCBOE:VXST) to the CBOE VIX Volatility Index (INDEXCBOE:VIX) as a method to improve long entries in the S&P index.  In last week’s article, we shared some preliminary numbers, using peaks in the ratio to identify opportune…

Backtesting The VXST VIX Ratio For Trading The S&P 500

Last week, we took a dive into a key volatility ratio that traders can use for timing equity trades. Recap:  In last week’s article, we examined the ratio of the CBOE VXST Short-term Volatility Index (INDEXCBOE:VXST) to the CBOE VIX Volatility Index (INDEXCBOE:VIX). As you can see from the chart…

Stock Market Update: Weak Dollar Gives Earnings A Boost

The popular stock market indices continue to pursue a slow and persistent track to new record highs. The S&P 500 (INDEXSP:.INX) is trading at new all-time highs in Tuesday trading. Stocks have been supported by improving second quarter earnings and by CFO reports of stronger top-line growth. The decline in…

Is The VIX Volatility Index Overdue For A Move Higher?

The lack of volatility in volatility is once again giving rise to the phrase ‘it is different this time”.  If past is any guide, it seldom is. Spot VIX Volatility Index (INDEXCBOE:VIX) just created a record. VIX goes back to January 1990.  In its 27-year history, it closed below 10…