Update on last week's rare VIX pattern appearing again ...

Last week's comments are found first, followed by today's comments below ...

Last week's comments: This 12 month VIX chart shows a pattern that is fairly rare. This chart pattern has appeared a number of times in the past and has been pretty accurate. The pattern is where the VIX's support level is the bottom of a circle and the touch points follow the bottom of the circle. The difference I see is that the older patterns occurred over a longer period of time within the circle area.

In any case, this pattern should be watched because if it holds to the pattern, it will generate higher/lows on the VIX which will correlate with increasing fear levels, and increasing market risk. So, unless the VIX aborts this pattern within the next few days (by moving sideways or lower), then the market will start to increase its risk and fear levels. (Reference Note: This chart is updated every morning in Section 4, Chart 9c of the paid subscriber site.)

THIS week's comments: The chart below shows what happened since last week. From the chart above, you can see that the VIX was testing the bottom circular support last week. Now, when you look at today's chart, you can clearly see that the bottom support did hold with the VIX moving higher. (Remember that the VIX moves opposite to the market, so up movement is a negative.)

Do note that we have two important resistances coming up that could be a stopping point for the current short term rise. In any case, these comments remain valid ... Unless the VIX aborts this pattern soon (by moving sideways or lower), then the market will continue to increase its risk and fear levels. (Reference Note: This chart is updated every morning in Section 4, Chart 9c of the paid subscriber site.)