This VIX sell off is overdone!

[spinn]

Quote from gastropod:

Contrary to "common knowledge" - the VIX does NOT measure volatility in the market. The VIX measures purchases of some options which "should" be a measure of volatility in the market. That knowledge in hand...the VIX is being ignored these days. The "market" is TOTALLY manipulated these days. Read up on the PPT (aka "Plunge Protection Team" aka "President's Working Group on Financial Markets"). The PPT plays with FUTURES to manipulate the markets. They do NOT play with options to do their manipulations. In the "old" days...some "players" used to play the VIX in relation to where they thought the market was going. Nowadays the "players" are gone...because the market goes where government manipulation "tells" it to go - UP!!! This fucking horseshit will continue until the US government collapses (shortly) because it has created an atmosphere devoid of trust in "markets." We will now here from either evil assholes who deny the manipulations of the PPT or we will hear from dumb fucks not smart enough to see the manipulations of the PPT. Please see my previous post that PROVED manipulations in the currency markets -> http://www.elitetrader.com/vb/showthread.php?s=&postid=2209106&#post2209106 Check out the link at the top of that thread - the New York Fed admitted to playing in currency markets.

-gastropod

I am glad someone gets it, as far as I am concerned, markets no longer exist.

 

[DarthSidious]

Quote from SomeYoungGuy:

It's an integral (or derivative or whatever) relationship.

As the market approaches infinity, VIX approaches zero.

If the market doubled from here, VIX would be cut in half. If the market went up 10x, Vix would be a tenth of what it is now.

I wish it was as simple as that, but unfortunately not so. VIX tends to go lower as markets sits in one place or tends to creep up. VIX is a measure of implied uncertainty (right or wrong - it's what it is), not a simple inverse relationship of stock prices. If the markets are doubling from here (in what time frame? 3 / 6 / 12 / 24+ months?), and VIX is at half of what it is now, I will just buy boat loads of options and be very rich. "They" would have to sell the options super cheap as you know, VIX is in the toilet

 

[LivingInVol]

Quote from SomeYoungGuy:

It's an integral (or derivative or whatever) relationship.

As the market approaches infinity, VIX approaches zero.

If the market doubled from here, VIX would be cut in half. If the market went up 10x, Vix would be a tenth of what it is now.

VIX is widely known to have a mean reverting aspect to it. You can think of it like a rubber band, the higher it gets the more forces pulling it down and the lower it goes the more forces pushing it up. It can never go to zero because that would imply that there will be absolutely no movement in the market. It also has a theoretical upper bound because then that would mean that prices are jumping all over the place.

 

[Random.Capital]

Quote from shortie:

last time VIX hit multi-year low (in mid-Jan) the market started a prompt dump a week later. we have not breached that low on VIX yet but we are have come very close. so if history repeats itself than a major dump is just around the corner.

The time before that, VIX dropped another 40% and markets continued grinding upwards.

No matter what happens next, "history" will repeat.

 

[noddyboy]

Quote from Random.Capital:

The time before that, VIX dropped another 40% and markets continued grinding upwards.

No matter what happens next, "history" will repeat.

for the record, I am long ewz and gld. I just can't see how I can win but I don't trade emotions fortunately.

 

[shortie]

Quote from Random.Capital:

The time before that, VIX dropped another 40% and markets continued grinding upwards.

No matter what happens next, "history" will repeat.

wrong!

even in Apr, May and June there were sharp SPY corrections as VIX was getting oversold.

 

[noddyboy]

Quote from noddyboy:

VIX is at 17.43 expecting another Monday rally.

another point I was making is that the VIX is miscalculated as there is no vol on the weekend so it drops on Friday and rallies Monday. That we have merger Monday madness makes this worse...

 

[gastropod]

Quote from spinn:

I am glad someone gets it, as far as I am concerned, markets no longer exist.

Thanks!

 

[NoDoji]

Quote from Petsamo:

WOW !! Dow 14000 here we come !!

stock_trad3r??

 

[independenceair]

Looks a Tad low ...I'm guessing sideways using weekly timeframe..it could remain stubbornly low although its looking like an oversold item in the near future. I suspect a rounding bottom on the horizon...how much stimulus is left ?