When ‘Awesome’ Turns

Posted | 17/10/2017 / Views | 5693
Back to News
Next Article

Another night, another all-time high on Wall St...  The lack of volatility in this market really has technical analysts scratching their heads.  The VIX (volatility index) broke into single figures last night, just as it was in 2007 just before the GFC hit, and last week short bets on the VIX broke all time records.   ‘Everything is awesome’, ‘let’s all pile into risk assets’ reign supreme until, well, it turns.  The more extreme, the bigger the turn.  Let’s have a look at a few charts doing the rounds overnight and see what picture they paint.

First, that record VIX short:

When ‘Awesome’ Turns

Gordon Gekko would love the following chart:

When ‘Awesome’ Turns

Late last year we explained why the flattening UST yield curve matters.  (you can revisit that article here).  Well that spread just hit recession (red band) alert levels, clearly there are a lot of people still not buying the ‘awesome’ message:

When ‘Awesome’ Turns

Or, to see this in context, let’s look at what has happened since Trump came to ‘drain the swamp’…

When ‘Awesome’ Turns

Or maybe for more context again…

When ‘Awesome’ Turns

History repeats, it just never tells you exactly when.

Subscribe to Our Newsletter

Daily or weekly emails with gold and silver price, bullion news and important economic events from around the world.

Daily or weekly news on everything gold, silver and crypto.

Ainslie Bullion - Build Wealth with Gold and Silver

Ainslie Brisbane
L6, 12 Creek St, Brisbane CBD
1800 819 474

Ainslie Melbourne
L14, 357 Collins St, Melbourne CBD
1800 246 754