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Volatility Bid...

Just to add on to some of my previous posts about growing market stress, here's a look at VIXY (long Vol ETF) vs the SPY over the last 5 days...


A couple of things worth noting: 1) the VIXY is a levered vol ETF so the scale isn't consistent with the non-levered SPY but the point is clear that perceived risk in the market is rising and 2) the S&P tested support levels today but didn't break down while volume remains light.  This suggests to me that the market is waiting things out and there are two potential catalysts between now and the end of the year... the election (which everyone will be glad to finally have over) and the two final Fed meetings of 2016 (one of which will conclude on Wednesday).

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