EOM Technical Tuesday 9.13.16 SPX VIX or VOX?

Major profit taking (selling) continued today, leaving all three major indexes closing deep in the red.

As stated yesterday, “It is not uncommon to have a large reversal day after heavy selling or buying days.” What is uncommon, is three days straight of selling, buying then selling. Usually, there are days of calm before buying or selling continues.

Adding to the confusion is selling of both stocks and bonds. Usually, when selling hits one group, it goes into the other. For example, when Bonds sell off, money goes into stocks and vice-versa.

Let’s add to the confusion a little more because selling is also hitting foreign markets, Gold and Silver.

For this and other reasons, I expect to see increased volatility this month and in October. If I am correct, are you prepared with your Garden Growing candidates?

Currently,  we track the $VIX Volatility Index. I also watch the $VOX Volatility Index, focusing on the S&P 100-the original VIX Index.

Q. Which Volatility Index (VIX or VOX) is the best?

A. There is no best or worst, only which Index the Institutions are using.

Per my SPX chart, I have both indexes with trend lines drawn. The $VXO trend line is closest to the current action. If selling stops when the trend line is hit, our answer is the $VOX. If the selling does not stop, then, our answer would be the $VIX.

By request, the remainder of the week I feature volatility Funds to make money-no matter which way the market goes.

Next week, I highlight the High-Dividend Fund All-Star A & B list to help prepare for your Garden Growing candidate decisions.

Enjoy your evening,

David O. England

Plan your work, work you plan, share your harvest! Philippians 2:3-4

This information is for Educational purposes only. It shall in no event be construed or interpreted as an offer or recommendation to buy or sell securities of any kind.

DAVID O. ENGLAND is the founder of the Eye on the Market-Training Academy and Associate Professor Emeritus of Finance. This column is presented for educational purposes only and is not intended as financial advice.

If you have a question or comment, contact David England at eyeonthemarket@outlook.com.

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