Contrarian Stock Market Investing News - Featuring Bargain Stocks » support line http://www.contrarianprofits.com Access market-beating ideas from the world's top investment gurus on stock market investing, the gold market, ETFs, Forex trading and real estate values. Mon, 10 May 2010 15:10:45 +0000 http://wordpress.org/?v=2.8.5 en hourly 1 The VIX is Screaming BUYER BEWARE! http://www.contrarianprofits.com/articles/the-vix-is-screaming-buyer-beware/15250 http://www.contrarianprofits.com/articles/the-vix-is-screaming-buyer-beware/15250#comments Thu, 26 Mar 2009 05:24:06 +0000 Charles Delvalle http://www.contrarianprofits.com/?p=15250 The stock market has rallied over 20%. Everyone thinks that we’re in the midst of the next ‘suckers rally’. I’m even convinced that the market will head up over the next few months. But the Volatility Index (VIX)  is still saying ‘buyer beware’.

(If you’re unsure what the VIX is, check out this explanation here.)

As you can see in the chart above, the VIX formed a support line at around 40.

This is a very important line because it hasn’t been breached since late September – just after the Lehman fiasco.

Considering the VIX index measures fear, a break under it would symbolize a less fearful and volatile market. And less volatility correlates perfectly with higher stock prices.

So if you want to…

]]> The stock market has rallied over 20%. Everyone thinks that we’re in the midst of the next ‘suckers rally’. I’m even convinced that the market will head up over the next few months. But the Volatility Index (VIX)  is still saying ‘buyer beware’.

(If you’re unsure what the VIX is, check out this explanation here.)

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As you can see in the chart above, the VIX formed a support line at around 40.

This is a very important line because it hasn’t been breached since late September – just after the Lehman fiasco.

Considering the VIX index measures fear, a break under it would symbolize a less fearful and volatile market. And less volatility correlates perfectly with higher stock prices.

So if you want to be extra safe before buying stocks, wait for the VIX to break under 40 before jumping in.

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