With equities pushing higher for a second day, the VIX was again knocked lower, settling -7.2% @ 14.52. Near term outlook is for the VIX to remain in a tight 15/12 zone. However, if there is a key reversal at the Wednesday FOMC, first target is the big 20 threshold.
This two day pull back from the low 18s is a particularly strong one, and the question is whether the strong drop is indicative of a new multi-week equity up wave..or whether its just a sign of increased volatility in volatility itself!
How we close tomorrow afternoon will be pretty important.
Equity bears should probably look for a reversal (hollow red) candle on the VIX daily chart tomorrow.
A weekly close in the 16s is arguably the minimum the equity bears need, to have any hope of a break back <sp'1800 by end month.
more later..on the indexes