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The VIX/Gold Correlation: Higher Volatility Ahead for SP500?
 August 09 2016 ​( From TradingView , CNN)
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The Situation

​​​In these greedy times (good to know that​​ the Fear and Greed Index
​from CNN Money is coming from the Fear zone post-Brexit (June 27 2016)
​to the Extreme Greed Level now at 84. ​
It is interesting to look the behavior
​​(correlation) ​of the VIX and the ​Gold in relation ​to the US Dollar ​​(USD-DXY)
​​and the Mighty ​SP500 Index.


​​​​As shown by the charts below, this correlation tells that the risks have not started ​to be fully priced into the foreign exchange and stock market yet in terms of volatility: expect more volatility in the US Dollar and SP500 in the next few sessions...​​

​​​​VIX/GOLD correlation getting over the 0.70 zone on August 8 ​2016 and VIX ​at 11.50, well below its 200 DMA (Day Moving Average) at 17.07, ​indicating higher volatility ahead as history suggest... 
(See first chart below - Top Panel - Amber Line)

​​​The US Dollar Index is within an Uptrend Channel (See first chart below - Bottom Panel - Uptrend Channel) but most importantly getting back near the resistance zone reached in September 2015. Also quite interesting to observe that we are testing the 50% Fibonacci zone again at 96.56 (from low of 92.62 on August 24 2015 and the high at 100.51 reached on December 2 2015). (See first chart below - Bottom Panel - Thick Red Trendline): Breaking those levels will increase tremendously the Volatility of all US Financials Assets. 

​For the SP500 index, it started a Bullish Trend from the post-Brexit panic on June 27 2016 to make a Breakout on July 8 2016 (from a
 Major Resistance Trendline that started back on May 20 2015) (See 2nd chart below - Bottom Panel - Top Red Trendline) to reach new high ever since. The SP500 Index is within a tiny Daily Uptrend Channel since June 27 2016. (See 2nd chart below -  Bottom Panel - Uptrend Channel)

​​So both the US Dollar Index (DXY) and the SP500 are within a technical set up that call for a  higher Volatility environment as history suggest according to the VIX/GOLD correlation. Also, the seasonality of the VIX is toward higher level: VIX near seasonal low ahead of most volatile time of the year





The VIX/Gold Correlation: Higher Volatility Ahead for SP500? $SPY, $SPX, $VIX, , $GLD,  USDX #Trading #vix  #gold #SP500 #moments


VIX ( Top Panel )​
CORRELATION​
VIX over Gold Correlation ( Middle Panel )
​​SP500 Index ( Bottom Panel )
VIX ( Top Panel )​
CORRELATION ​
VIX over Gold Correlation ( Middle Panel )
​​US Dollar Index ( DXY - Bottom Panel )

Financialiceberg.com
Financialiceberg.com