Sunday, April 13, 2014

2014.04.11 VIX Cycle Model Chart

2014.04.11 VIX Cycle Model

The VIX cycle model suggests higher VIX prices are to be expected over the next year. However, astute readers will notice that as shown above, the turning points are better predicted than the magnitude of the change at those points. Right now, according to the model, the VIX is below the predicted curve, and a very short term upward correction, as happened after previous positive and negative spikes, is very likely.  Readers may note I lifted some of the above text from a previous post from January, 2014, shown here. The model has not changed much at all.  Here it is below.

2014.01.24 VIX Cycle Model


Permabear Doomster said...

hey there

Any guess for how high VIX might spike Mon-Wed ?

I'm seeking at least a brief hit of the big 20.

However, if Dow loses 15700s, then there is surely a brief chance of much higher VIX levels.

The 2012 high was 27..that'd sure be a fair way up!

Paolo said...

Howdy, Permabear. You're a better prognosticator than I am when it comes to estimating VIX magnitudes! That said, I would agree with you. The neural model I have for VIX is on the strongest buy in months, but it does not give me a magnitude. The cycle model is sort of a moving average curve, and I cannot model very short term spikes up and down. We'll have to see if the general VIX trend is indeed upwards...