Tags: VIX | S&P 500 | 2007 | October

VIX Breaks Below 11 for First Time in 7 Years

By    |   Tuesday, 10 Jun 2014 08:07 AM

Usually when you see the numbers "7" and "11" together, you start thinking about convenience stores and Big Gulps, but those two numbers are relevant when it comes to the CBOE Volatility Index (VIX) as well.

The VIX closed at 10.73 on Friday, the first time since February 2007 the indicator as been below the 11 level.

We all remember 2007. The S&P 500 was hovering around the 1,400 level in February and then rallied up to 1,576 in October.

Of course, during the next 17 months, the S&P 500's value would get cut in half.

The VIX jumped to 37.50 in August 2007 and would eventually peak at 89.53 in October 2008.

What caught my attention about the chart for the VIX back in 2007 was how the low came in February when the S&P 500 didn't peak until October.

Conversely, the VIX peaked in October 2008 and the S&P 500 didn't hit its low until March 2009.

It should be pointed out that the VIX dropped below the 11 level in six straight months and even dropped below 10 a few times, so the index could still go lower or even hover down at these levels.

With that being said, the monthly stochastic readings and the 12-month relative strength index weren't as low in 2007 as they are now, so we could see the VIX reverse sooner rather than later.

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Pendergraft
Usually when you see the numbers "7" and "11" together, you start thinking about convenience stores and Big Gulps, but those two numbers are relevant when it comes to the CBOE Volatility Index (VIX) as well.
VIX, S&P 500, 2007, October
232
2014-07-10
Tuesday, 10 Jun 2014 08:07 AM
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