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Saturday, April 25, 2009

VIX Wave Structure

From a peak of 89.53 the VIX has worked its way downward. The best pattern I can make is a double 5-3-5 zig zag with a Triangle (X) wave in between the 2.
What is interesting is that in both zig zags, C almost perfectly equals A.
I showed in yesterday's post where the VIX diverged from the market. So perhaps I have this waveform correct. Obviously if the market explodes upward in some surprise move, the VIX will morph and continue to develop its pattern. But as it stands right now, the VIX structure very much supports a pullback period for the market.


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