Market Cycle:
-Long-term price cycles are a fact of economic life. For example, the U.S. stock market tends to run in four-year cycles. They exist because the ruling party inflates the economy going into the presidential election once every four years. The party that wins the election deflates the economy when voters cannot take revenge at the polls. Flooding the economy with liquidity lifts the stock market, and draining liquidity pushes it down. This is why the 2 years before a presidential election tend to be bullish, and the first 12 to 18 months following an election tend to be bearish.
Volatility Index $VIX
(Source: Wikipedia)
VIX is the ticker symbol and the popular name for the Chicago Board Options Exchange's CBOE Volatility Index , a popular measure of the stock market's expectation of volatility based on S&P 500 index options.
It is calculated and disseminated on a real-time basis by the CBOE , and is often referred to as the fear index or fear gauge. I consider that a $VIX above 30% is a very bearish signal. Above 30% translating investors selling in masse their assets.
Regardless of Coronavirus circumstances it's remarkable that a lot of people took more risks than others, "investors became more value ones than before". VIX is showing a strong confidence in the economy despite of the 2$ TRILLION injected liquidity and inflation damages and since it's ranging in the bulls zone we're more likely to see more buyers jumping in with the stimulus checks, until that day I'm expecting a pullback and recovery of the market.
-Long-term price cycles are a fact of economic life. For example, the U.S. stock market tends to run in four-year cycles. They exist because the ruling party inflates the economy going into the presidential election once every four years. The party that wins the election deflates the economy when voters cannot take revenge at the polls. Flooding the economy with liquidity lifts the stock market, and draining liquidity pushes it down. This is why the 2 years before a presidential election tend to be bullish, and the first 12 to 18 months following an election tend to be bearish.
Volatility Index $VIX
(Source: Wikipedia)
VIX is the ticker symbol and the popular name for the Chicago Board Options Exchange's CBOE Volatility Index , a popular measure of the stock market's expectation of volatility based on S&P 500 index options.
It is calculated and disseminated on a real-time basis by the CBOE , and is often referred to as the fear index or fear gauge. I consider that a $VIX above 30% is a very bearish signal. Above 30% translating investors selling in masse their assets.
Regardless of Coronavirus circumstances it's remarkable that a lot of people took more risks than others, "investors became more value ones than before". VIX is showing a strong confidence in the economy despite of the 2$ TRILLION injected liquidity and inflation damages and since it's ranging in the bulls zone we're more likely to see more buyers jumping in with the stimulus checks, until that day I'm expecting a pullback and recovery of the market.