Vix, Yen and TLT

Vix today jumped 7% closing well above its 10 day upper BB and above its 20 dma. This trend is disturbing for equities with Vix above its 20 dma has been associated with a down trend in stocks.

The move up in Vix coincided with further strength in Yen as well as in Treasuries. The Japanese Yen has strengthened 5% since early last week, a giant move in the world of currencies. By the looks of it, FXY is going to test its upper BB very soon.

TLT, after hovering around 112 all week, seem sto have broken north. IEF (Barclay's 7-10 year Treasury fund) moved up strongly today as well.

I suppose these results are not surprising, given the weakness in equities. What is more of a concern is that each of these signals have more upside before reaching resistance, suggesting that there will be further weakness in equities.


But it is interesting that VIX/VIX did not rise today, although I am not sure what to make of it. In November VIX/VXV was flat over the middle portion of the month, wihle equities were down.