I have to put on my “Pattern Police” hat and rant about the VIX. While I am not entirely sure patterns, support and resistance mean anything at all on this indicator, let’s assume they do for now. With today’s action, a possible breakdown is on its way to being negated.
In this version, using only closes, which is perfectly valid for normal instruments, the line is similar to mine only a few points higher. But do both versions really present solid chart pattern construction? Do either make a strong case for a support level in the VIX other than one “lowest low” point back in January?
The VIX measures zones of fear and not trigger levels unless at extremes. 40 today is not an extreme. And for traders, the VIX measures something to be used for a reversion to the mean approach – a la Larry Connors.