VIX "wall of fear is approaching." What characterizes the volatility index indicates increased activity. The analysis shows that fractal construction has taken place in the volatility index. We have reached the ascending stage of this fractal. This indicates increased price movements for different asset classes. This phenomenon indicates panic. Although it can also be seen that a few days, perhaps a week of uncertainty ensues. We can also see that this may be temporary, before another even more significant correction.
@PriceActionAnalyses, Thanks. Yes. The question now for me is whether investors will climb or jump off it. Seeing the dollar strengthening, I see a greater chance of a jump for the time being. This could be good news for cryptocurrencies.
@meszaros, I noted Grantham's piece about the likelihood of an impending crash. I would be interested in your view of this..
meszaros
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@piersede, I see an increase in fear and volatility technically clear. This analysis also draws attention to this. But I don’t expect a major stock market or other kind of financial collapse.
ZenDegen
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@meszaros, Usually cryptocurrencies are 'risk on' assets, do you not think that if stocks crash, crypto currencies will follow them? (except for Bitcoin which could rise with the narrative of store of value/digital gold)
meszaros
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@ZenDegen, I don’t think stock markets would collapse. Minor correction and rising all the way. Crypto currencies are following the rise. :)
ZenDegen
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@meszaros, Thanks for the reply! But how could the VIX ever get to 70 without a huge drop in the markets? Has this ever occurred before? Surely VIX only rises when there is fear in the markets and by default stocks drop when there is fear no?
meszaros
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@ZenDegen, The question is very good thank you. VIX is a volatility indicator. We usually associate the increase in volatility with fear. But there is another effect on the stock markets. This is nothing but a "rise on the wall of fear." These are characterized by the fact that after a minor correction (which I am still waiting for on the SP500) there may be another significant increase. Yes. On the wall of fear.
ZenDegen
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@meszaros, OK - maybe my misunderstanding is that when i read minor correction, I am thinking 5 or 6%, but I guess you mean more like 20/30%? Looking historically, every time the vix has pushed up above 40, the correction has been upwards of 20%.
Thanks again for your time!