Ocean Man: I know -0.7% isn't flat, but those who are calling today a mirror image of yesterday or another dip that got bought are ignoring +7% fear.
5/9/12
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Chines33: Another thing that reminds me of last summer VIX wouldn't move for longest time then just soared. Think it could head fake same thing.
5/9/12
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shaker33: I agree Vix is acting just like it did last spring before it went through the roof.
5/9/12
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Ocean Man: Yes, VIX didn't jump much above 20 during the 100-point drop in May and June last summer because it was gradual (like this month).
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Ocean Man: It was the quick 200-point drop in August that almost tripled the VIX. Then it stayed over 30 for most of the next 4 months (til Christmas).
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Ocean Man: 100 & 200 S&P points I mean. Point being, 100-pt drop takes VIX 16-20 (+4) but a 200-pt drop takes it 16-48 (+32). Not linear LOL.
5/9/12
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Ocean Man: And we're already down 65, so we don't need a 200 drop from here. Just one Markets In Turmoil 5% down day would just about do it.
5/9/12
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shaker33: OM, all it will take is somebody in Europe to say something the market doesn't like and we're over 25 in a flash.
5/9/12
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Perkins Cove: So, what's the concensus....VIX to 30? Higher? And what about contango and backwardation? The derivatives are behind the spot VIX...IMO.
5/9/12
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shaker33: I think spot will spike to 24-25 range in the next couple of days on a big flush out. Then retreat to 16-17 before a post twist spike.
5/9/12
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briandiplacido: Not linear, 'cause fear is exponential...and additive, imo.
5/9/12
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Perkins Cove: Brian, you have been sucked inti the twilight zone known as VIX derivatives....LOL May the Lord, or Ocean Man, save you.....lol