• Author: Bob Kleyla

• The Importance of Identifying Favorable Stock Chart Patterns
• Using the Bullish-Bearish Indicator to Spot a Potential Market Bottom or Top
• An Analysis of Secular Bear Markets and Secular Bull Markets since 1900
• Using the 10 Day Moving Average of the VIX (Volatility Index) to time a Reversal in the the S&P 500
• Looking for Cup and Handle Chart Patterns before Buying a Stock

• How to Make Consistent ProfitsTrading Futures Part II
• What is The Law of Charts™?
• How to Make Consistent Profits Trading Futures Part I
• Planning: A Key to Successful Trading
• How to Make Consistent ProfitsTrading Futures Part III
• Futures Spread Trading
• Achieving Trading Perfection

Investors can get an idea of when the market may reverse when the 10 Day Moving Average (MA) of the Volatility Index (VIX) becomes significantly stretched away from its 10 Day Moving Average (MA). A simple example is shown below which compares the 10 Day MA of the VIX to the S&P 500.

Notice when the VIX got stretched significantly away from its 10 Day MA (blue line) to the upside (points A) that the S&P 500 made a bottom (points B) and then reversed to the upside.

Thus keeping track of where the Volatility Index is in relation to its 10 Day Moving Average can give investors a clue to when the market may be getting close to a near term bottom and possible upside reversal.

Regards,
Bob Kleyla
http://www.amateur-investor.net/