Last month the VIX posted a bullish outside month off the lowest level in over 4 years and in the first 5 days of August has literally exploded higher.
This morning it traded above 53%, something that it also did in August 2015.
On 8 occasions (including today) the VIX has rallied to between 48%+ and 53%+ going back to and before 1987.
The only times it has gone above this range are October 1987 (173%- VXO the old VIX), October 2008 (90%) and March 2020 (85%)
In the other 8 instances the highest weekly close seen was around 43%
So that makes this week and likely the coming days very pivotal
As I type, we are now back below 50% and the bias has to be that we have already seen the blowout high as per those other 8 instances
IF , however the VIX rallies again and moves above 54% then this could get really bad really fast.
Importantly the VIX is a measure of volatility- not direction and it is perfectly possible and highly likely that the market can still go lower without the VIX going higher from here.
If this rally in the VIX dissipates then so likely will the pricing of an intra-meeting cut
