Higher stock prices (NYSEARCA:DIA) have kept a lid on stock market volatility.
The S&P 500 volatility index (ChicagoOptions:^VIX), also known as the “fear index,” has now fallen around 17% over the past month and is back below its 200-day moving average. Does the stock market’s general lack of fear mean that volatility has reached a permanently low plateau?
Since September 2014, each time the VIX (NYSEARCA:VXX) dipped below its 200-DMA it’s led to the following spikes:
For now, all is safe and calm in the worry-free U.S. equity market (NYSEARCA:IWV). That’s of course until the unexpected moment when it’s suddenly not.