Always consider hidden risks
SP500 and Russel1000 Financial Services and VIX: No Fear Priced Into the Market ?
July 30 ( From Stockcharts )
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The main technical indicators like the Russel 1000 Financial Services
Index ( RIFIN ) and the VIX ratio compare to the SP500 are confirming
the very low level of fear into the market.
On July 27, the 7 DMA reached 111.11, above the 110 threshold
indicating a zone associated with a market that is not showing fear and one
of the highest confidence level of the past year as shown by the chart
below. Last time that ratio reached that level was in August 2014.
Since July 10, that ratio rose gradually and reached
the zone associated with a low fear factor priced into
the market and overdone on a short term basis.
(spot level is at 110.51 as of July 29).
And we are into the zone where we usually at risk to see a short term market downleg as history suggest. ( see chart below - ellipses )
Also observe the Major Trendline since August 2014 at 110 for this ratio.
But the most interesting factor is the correlation between the Mighty SP500 Index with the US Dollar Index (DXY). And we are into the zone where we usually at risk to see a short term market pressure as history suggest.
( See 2nd chart below at the bottom - vertical lines and ellipses )
SP500 and Russel1000 Financial Services and VIX: No Fear Priced Into the Market ? $SPY, $SPX, $ES_F, $IWM #Trading #Emini #iwm #SP500
Russell 1000 Financial Services over VIX Index ( Top Chart - Dots - 7 DMA Blue Line )
SP500 Index ( Candles Second Chart )
Correlation SP500 Index with US Dollar (DXY) ( Second Chart - Line Bottom Panel )