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"DEATH to anyone guilty of debasing the money"


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Let's see - the volatility index last July and October was 45.  Why is an index of 22 now, when puts are cheap, a bad sign for bears?

Fair question. VIX of 22 is low, in terms of recent years.

 

On the other hand, long-term historical volatility of the market during the 20th century was around 15%. VIX was in a range of 12 to 15 during some low-volatility years in the mid-90s. If VIX had existed in the early Fifties, it might have been even lower ... below 10. We can only guess from the historical volatility figures, since listed options debuted in 1973.

 

It's hard to imagine that volatility could die down and VIX could go that low again. But it's not impossible. The mathematicians (Edgar Peters, specifically) say that volatility is an anti-persistent series, with high extremes followed by low extremes. Reality is stranger than fiction. So make my day, VIX.

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Fair question. VIX of 22 is low, in terms of recent years.

 

On the other hand, long-term historical volatility of the market during the 20th century was around 15%. VIX was in a range of 12 to 15 during some low-volatility years in the mid-90s. If VIX had existed in the early Fifties, it might have been even lower ... below 10. We can only guess from the historical volatility figures, since listed options debuted in 1973.

 

It's hard to imagine that volatility could die down and VIX could go that low again. But it's not impossible. The mathematicians (Edgar Peters, specifically) say that volatility is an anti-persistent series, with high extremes followed by low extremes. Reality is stranger than fiction. So make my day, VIX.

Thanks. :rolleyes:

 

I dimly remember from the 60s how slow the market seemed to move compared to the following decades.

 

Is 20 or so the lowest it could go? Don't know but my intuition says somwhere around here is the lowest it should be now.

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I think the VIX will see higher extremes until the end of the secular bear.

 

The lower extremes in the 10 range will come at the end of the bear when no one is interested in stocks.

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I dimly remember from the 60s how slow the market seemed to move compared to the following decades.

For a 'Dogs of the Dow' study, I was collecting quotes from the first trading day of each year. In some years in the 1940s, you would have to go to the second or third trading day of the year to find a sale ... of a Dow Industrials stock. In others, the daily volume would be 200 or 300 shares.

 

Now THAT is sleepy. And it represents the endpoint of the true blue bear scenario -- where the stock market becomes a neglected, cobwebbed backwater, because it's perceived as boring, irrelevant and totally uncool.

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Could one of you pattern masters help me out. I'm seeing a possible boolish cup and handle forming on bars of 5 and 10 minutes. Anyone else seeing that?

It's there all right. 8-min too.

 

Gom warning against going long at these levels

post-3-1057940093_thumb.jpg

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Guest libertas
some years in the 1940s, you would have to go to the second or third trading day of the year to find a sale ... of a Dow Industrials stock. In others, the daily volume would be 200 or 300 shares.

Wow. That is amazing.

 

Also remember in the 1970s when the pension fund industry (successfully) pressured for legislation to enable them to trade real estate and diamonds (really) because there was obviously no hope of making any money in stocks.

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