For all of the fireworks in the S&P 500 Index (SPX) in the aftermath of this morning's hi-lo spike in reaction to the ECB rate cut, the VOLATILITY S&P 500 (VIX) really remains curiously detached.
Does the lack of upside reaction in the VIX indicate a dangerous complacency lurks beneath the surface of the market, or that we really don’t have much to worry about in terms of a wicked decline in the SPX yet?
I would have thought that the cash VIX would rocket from under 13.00 to above the most recent failed peaks at 14.21/36.
The VIX could not even climb and sustain above 13.55/60, its nearest resistance plateau amidst an 18-point near-free-fall plunge in the SPX!
I really don’t know what to make of the SPX-VIX interaction today, so far, but my inclination is to think that dominant uptrend in the SPX is very much intact for the time being.