There is no doubt the market is in a state of chaos right now. The big question is whether this is just a correction or an actual changing of the trend. Either way, we won’t really know until it actually happens.
Nonetheless, we can always use a little big of history and comparison to try and forecast what is to come.
The chart below shows you what has happened to the S&P 500 when VIX hit +35. You’ll notice that most of the time the reading resulted in a change of trend. The blue arrows mark where the VIX was +35, red line is VIX, black line is S&P 500.
Where do you think the market is headed next?