S&P 500 and Volatility

After a brief flicker of fear, when volatility spiked above 30, the VIX is hovering around 20 suggesting uncertainty. The market is undecided whether to take this Twitter War seriously.

CBOE Volatility Index (VIX)

The S&P 500 is again testing primary support around 2550 but Twiggs Money Flow remains comfortably above zero, indicating long-term buying support.

S&P 500

Twiggs Volatility (21-day) is still in the amber zone, between 1% and 2%. A rise above 2% remains unlikely but another trough above 1% is my primary concern and would convince me to reduce equity exposure to 50% (of portfolio value).

S&P 500

J.P. Morgan once had a friend who was so worried about his stock holdings that he could not sleep at night. The friend asked, “What should I do about my stocks?” Morgan replied, “Sell down to your sleeping point.” ~ Burton Malkiel

5 thoughts on “S&P 500 and Volatility

  1. Solomon says:

    Colin, come-on now …. the market has fallen more than 10% in the last two months [ = the *canary* ] ; the volatility has adjusted to reflect increased risk ; the significant moving averages have turned …. it makes little sense to me to further await the breaches / signals you refer to [ = the moving average/trend changes over the shorter term are much more significant ] ; the market remains grossly over-valued .

    You will see that my comments of a few months ago are similar.

    Reduce that exposure NOW to the 30% levels [ in point of fact, using your own criteria listed above in your article, you should have done so during February, as is clear ]

    A confused handling / acceptance of risk by yourgoodself is very evident, I am afraid.

    • ColinTwiggs says:

      When the market rallies, I don’t hear from you. When it falters, you’re all over it. Looks like you want a bet each each way.

      • solomon says:

        The market is down by more than 10% in two months …. you have heard from me continually during that period – it’s been down = THE RALLIES ARE THUS SEEN not to have mattered at all – and it won’t matter over a 12 month view as well.

        Can’t therefore match your last sentence to my two-month old call for selling the markets – you can go and check my calls.

        Cheers, and all the best of luck


  2. grahamdcox says:

    Colin . I paid for one moths of your charts, never used it and expressly stated no extension. Yet I am being charge every month. Graham Cox

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