On the cycles of the S&P500 / VIX ratio and the stabilizing cost of USD 3-month LIBOR relative to its yen counterpart.
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Fifty two weeks after the S&P500 hit 12-year lows at 666, the index rose 68%, driving down near Januarys 19-month lows. Much analysis has been done on equity indices and the VIX on the S&P index options. But the relationship between the two merits some attention. While neither the S&P500, nor the Dow have yet retested their January highs, the technical dynamics of the SP500/VIX ratio can be used as a possible leading signal for a looming decline in the S&P500 index. On Friday, March 5th (52nd Friday of the 666 low in the S&P500), the S&P500/VIX ratio hit a 5-week high at 65.38. This level suggests these key developments:
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