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Saturday, March 12, 2005 10:38:00 AM
VIX, VXO, VXN vs SOX - BPNDX and BPCOMPQ vs SOX on 5 year weekly charts:
3 Year Daily Charts:
Interestingly enough the all time record low for the semi equipment btb was established in April 2001. The actual low for the SOX in this cycle as you can see was in October 2002. By then the VXO had spiked over 50 for a third time in less than 13 months. And the BPNDX had hit 5 lows of less than 20 during that time period while establishing a positive divergence. Each of the major three BPNDX lows was higher even as the SOX set lower lows.
The btb alone probably has little predictive value concerning what direction the SOX will trade. It is most important to watch volume for clues because which direction the SOX is going to trade is determined by institutional traders.
Lets try the VIX and BPNDX vs AMAT on some charts here. Please note that while the VXO is much higher than it was most of the last year it is still showing very little fear on a long term basis. Not the kind of volatility we normally associate with a long term bottom:
Volatility Indices versus SOX and BKX on 5 Year Weekly Charts
VIX, VXO vs COMPQ on 5 Year Weekly Charts:
3 Year Daily Charts:
Interestingly enough the all time record low for the semi equipment btb was established in April 2001. The actual low for the SOX in this cycle as you can see was in October 2002. By then the VXO had spiked over 50 for a third time in less than 13 months. And the BPNDX had hit 5 lows of less than 20 during that time period while establishing a positive divergence. Each of the major three BPNDX lows was higher even as the SOX set lower lows.
The btb alone probably has little predictive value concerning what direction the SOX will trade. It is most important to watch volume for clues because which direction the SOX is going to trade is determined by institutional traders.
Lets try the VIX and BPNDX vs AMAT on some charts here. Please note that while the VXO is much higher than it was most of the last year it is still showing very little fear on a long term basis. Not the kind of volatility we normally associate with a long term bottom:
Volatility Indices versus SOX and BKX on 5 Year Weekly Charts
VIX, VXO vs COMPQ on 5 Year Weekly Charts:
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