Last week was certainty an interesting week. Let’s review it all, next!
A couple things stood out last week. First, the beginning of the week, saw a rehearsal of the recent winning trade as the VIX moved higher, gold moved higher, interest rates moved lower, and growth outperformed value.
Second, was the price action on Thursday as the Dow had one of its all-time worse price drops. The massive sell-off, interestingly enough, came during a time of investor complacency and talk of new record highs.
As we enter this new work week, let us keep an eye on the VIX. During the sell-off witnessed earlier this year, things really started to get ugly when the VIX crossed above 30. During the big down day last Thursday, the VIX spiked above 30 once again. This implies a time of heighten volatility which usually results in big price moves. So, let’s keep an eye on this 30 level and if the VIX continues to move further away from it or starts to descend down through it.
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