Saturday, January 24, 2015

Volatility On The Rise As Gold Being Bid Along With Other Safe Havens

It is really no coincidence that volatility is on the rise in the markets, and that it comes slightly after the end of Quantitative Easing.
The VIX is a proxy for volatility, and its chart shows a structural rise over the last 4 months. The chart below indicates a pattern of “higher lows” towards the end of 2014. It all started with the sell off in October, when the VIX rose to a level not seen since the summer of 2012.
VIX_January_2015

Without any doubt, there is a correlation between the end of the extreme QE program of the U.S Fed, the collapse of oil and other commodities (think of Dr. Copper in the first place), and the rise of volatility in the markets. (more)

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