U.S. VIX equity volatility is gathering traction again
U.S. VIX equity volatility is gathering traction again having bounced from November 3 lows of 8.99 to highs of 12.19 yesterday. From opening levels near 10.78 today the VIX has ventured as high as 11.58 before pulling back to 11.26 as stocks pared some overnight losses into the open. Next target on the upside in the event of deeper equity losses on the tax cut negotiation gap is the October high of 13.20, compared to life lows of 8.84 set on July 26. The S&P 500 marked historic highs of 2,597 on Tuesday before stumbling to a low of 2,566 yesterday in a relatively minor 1.2% retracement compared to its 21.4% 1-year return. This should keep pressure on Congress to come up with a tax cut compromise or else face the wrath of investor/constituents in 2018 midterm elections.