Flash Blog Sunday 08 June 2008

A very quick entry as I don't have a chance at this moment to blog the "whole picture" but need to get this out asap (click to enlarge):



Simply....the VIX can be viewed as a "fear index". When the VIX (fear index) is "abnormally high" (which is an indication that the general investment community is overly bearish and abnormally fearful), this many times gives a heads up that there is going to be a future market rise.

The Bollinger Band (black bands surrounding the market price) normally restrict price movements to a 95% band of the underlying value. A movement above/below these levels is significant.

On Friday the VIX blew WELL above the upper BB. What this means is the stock market is MEGA oversold and due for a bounce.


Bottom Line:

This could be the first indication we are at a true intermediate term bottom that I blogged previously that I was looking for and due for a rise. The first day or two next week will determine my positions.

I am looking for this as an opportunity to buy into this market. I will await confirmation from my other indicators to confirm this but it is important to understand now is the time to potentially be looking Long/Bullish.


Legal Disclaimer: The content on this site is provided without any warranty, express or implied. All opinions expressed on this site are those of the author and may contain errors or omissions. NO MATERIAL HERE CONSTITUTES "INVESTMENT ADVICE" NOR IS IT A RECOMMENDATION TO BUY OR SELL ANY FINANICAL INSTRUMENT, INCLUDING BUT NOT LIMITED TO STOCKS, OPTIONS, BONDS OR FUTURES. The author will reveal his current market positions and holdings but actions you undertake as a consequence of any analysis, opinion or advertisement on this site are your sole responsibility.
I will advise when I make a move.