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What is going on with the Fear(VIX) index?

The CBOE Volatility Index is a key measure of market expectations of near-term volatility conveyed by S&P 500 stock index option prices. Since its introduction in 1993, VIX has been considered by many to be the world’s premier barometer of investor sentiment and market volatility. The VIX reached its all time high at 2008, when the real estate crisis was at its bottom. Since then we have been seen a huge decline in volatility, higher price action in stocks and an economic “recovery”. The chart indicates, that an ending diagonal and a top in stock prices may be forming. We have a three wave decline and an exhaustion of the downtrend.

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We expect to see higher volatility, negative sentiment(news) and lower prices in the stock market.



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