Global growth has been slowing for a while now. Many countries are making lower highs across the board and look awful with even worse incoming data. Yields are crashing. And the only thing left are US Equities. How long can they keep the world a float?
The Vix is sitting at 19 and has built a sideways base. This matches the bear flag of all the indices off the most recent highs. If the bulls have a chance, then they SMASH the Vix like they have the past 4 years to under 16. If the Vix spike, the equity bulls will be few and far between and a liquidity issue will be on our hands for the first time in a few years I am afraid.
Vix over 25 and you will start seeing air pockets. Let’s hope the bulls can hold the line.