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Based on the current price of 23.46, the VIX has gained 71.74% since the March 16th 13.66 low. Furthermore, it has gained 48.95% since the more recent April 26th 15.75 low.
This is quite a move and intuition would lean towards shorting volatility here. But is that the right play?
According the Inverse Head & Shoulders pattern, it’s not. The patten indicates a move to 30 (grey rectangle), which indicates 27.88% of upside from the current level.
Are technical patterns dependable in the VIX? Not always, but they should never be ignored. S&P Futures completed a head & shoulders pattern measured move with yesterday’s dip to 1300, which detracts from the validity of this VIX pattern a bit.
Bottom Line: We are moderately bullish in equities here, and will be aggressively bullish if the VIX reaches 30-33 range.