CT
Definitions of VIX
* An index of implied volatility based on the CBOE's OEX options. The exchange calculates the implied volatility of eight at-the-money or near-the-money strikes (both puts and calls) with a weighted average time to maturity of 30 days. Volatility: A statistical measure of the movement of a security over a specified time. Stocks with larger daily percentage movements have larger volatility.
The more general interpertation of the VIX is fear and complacency.
High reading = high fear
Low reading = complaceny or lack of fear
On the chart I sent you there really should be two horizontal lines on the VIX
1 at about 35 - 40 for high
1 at about 15- 20 for low
If the VIX is above 40 there is a lot of fear in the market, so it could be a bottom
If the VIX is below about 20 there isn't a lot of fear, so it could be a top
The spikes on the left side of the chart can be looked at short term bottoms.
Does this help?
The VIX is one indicator of many.
If you are interested in the technical analysis of the stock market take a look at MetaStock or one of John Murphy's books.
How did you post the chart?
