Out Fox The $treet

Some interesting action in the VIX and VXO this week and especially today. Even though the market turned down today and yesterday, the VXO especially hasn't confirmed further moves down. With the markets mixed at the moment, the VXO is trading with a 5% loss. For now at least, the end of May marked the peak in fear. Could be very constructive for a move higher.

Not hardly a week removed from hitting 45 on 9/18/08 and the market is back to this extreme level. Usually hitting the 40 level has historically been a huge buy signal for at least the next 4-6 months. Below are the times that 40 has been hit and only 2 times did it exceed 45 in the prior 20+ years until this month. Guess time will tell if this one leads to a huge rally. Date High 10/19/1987 152.48 8/24/1990 40.01 10/27/1997 40.04 8/27/1998 41.46 4/14/2000 41.53 3/22/2001 41.99 9/17/2001 47.7 7/11/2002 41.64 9/18/2008 45.81