{"id":23666,"date":"2025-04-03T07:30:00","date_gmt":"2025-04-03T11:30:00","guid":{"rendered":"https:\/\/jeffclarktrader.com\/market-minute\/?p=23666"},"modified":"2025-08-22T07:41:36","modified_gmt":"2025-08-22T11:41:36","slug":"when-volatility-is-exhausted-so-is-the-selling","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/when-volatility-is-exhausted-so-is-the-selling\/","title":{"rendered":"When Volatility Is Exhausted, So Is the Selling"},"content":{"rendered":"
\n\nManaging Editor\u2019s Note: <\/strong>Today, we\u2019re hearing from our contributing editor Mike Burnick in his weekly Thursday feature.\n\nMike has over 30 years in the investment and financial services industry \u2013 from operating as a stockbroker, trader, and research analyst, to running a mutual fund as a registered investment advisor and portfolio manager, to being Research Director for the Sovereign Society, specializing in global ETF and options investing.\n\nAnd he\u2019s been senior analyst at TradeSmith for three years, running Constant Cash Flow, Infinite Income Loop, <\/em>and Inside TradeSmith. <\/em>\n\nHere\u2019s Mike\u2026\n\n<\/div>\n

When Volatility Is Exhausted, So Is the Selling<\/h2>\n\n\n\n\nBY MIKE BURNICK, CONTRIBUTING EDITOR, MARKET MINUTE<\/em><\/strong>\n\n\n\n\n\nAt times like this, reading the morning market headlines can give you a case of d\u00e9j\u00e0 vu\u2026\n\n\n\n\n\nThis recent headline is a case in point:\n\n\n\n\n\n\u201cStocks Week Ahead: Liberation Day Fallout, Jobs Data May Unleash Volatility Spike.<\/em>\u201d\n\n\n\n\n\nWhere have I heard that before? Oh yeah, yesterday, and the day before that, and\u2026\n\n\n\n\n\nIt\u2019s true that stocks have struggled to get any upside traction with all the negative headlines about tariffs triggering more market volatility.\n\n\n\n\n\n\n\n\n\nBut a funny thing happened to the S&P 500 on its way to retest the lows this week\u2026 volatility didn\u2019t go along for a ride to new highs\u2026 and that\u2019s telling.\n\n\n\n\n\n\n\n\n
\"\"<\/figure>\n\n\n\n\nAs you can see in the chart above, the S&P 500 sank to a new low early this week, slightly undercutting the March 13 low.\n\n\n\n\n\nBut as you can also see in the upper panel of this chart, the CBOE Volatility Index (VIX), the stock market\u2019s fear gauge, failed to move to new highs at the same time.\n\n\n\n\n\nIn other words, market volatility is receding even as stock prices ticked lower. That\u2019s often an important tell<\/em> that the market is at or near a tradeable low.\n\n\n\n\n\nWhen volatility is exhausted, selling is soon exhausted as well.\n\n\n\n\n
\"\"<\/figure>\n\n\n\n\nAnd sure enough, in the past whenever the VIX cycles from an extreme, multiweek-range high back to neutral range or below, it has been a reliable buy signal for stocks.\n\n\n\n\n\nIn fact, this kind of VIX buy signal, the S&P 500 has been up 75% of the time over the next one to three months.\n\n\n\n\n\n\n\n\n\nAnd the last four times this signal flashed (as shown above), the S&P averaged gains of 10.7% three months later.\n\n\n\n\n\nMike Burnick\u2019s Bottom Line<\/em><\/strong>: While there could still be some downside ahead for stocks, history clearly shows that once volatility peaks and then recedes like it just did, stocks typically enjoy at least a strong relief rally, and at best hit new highs.\n\n\n\n\n\nGood investing,\n\n\n\n\n
\"Signature\"<\/figure>\n\n\n\n\nMike Burnick\nContributing Editor, Market Minute<\/em>\n\n\n\n\n
\n

Free Trading Resources<\/strong><\/p>\nHave you checked out Jeff\u2019s free trading resources on his website? It contains a selection of special reports, training videos, and a full trading glossary to help kickstart your trading career \u2013 at zero cost to you. Just click here<\/a> to check it out.\n\n<\/div>\n\n\n\n

\"\"<\/figure>\n","protected":false},"excerpt":{"rendered":"

We\u2019ve got a reliable buy signal.<\/p>\n","protected":false},"author":100,"featured_media":0,"comment_status":"closed","ping_status":"0","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"ep_exclude_from_search":false,"service":"","footnotes":""},"categories":[1],"tags":[],"publication":[10],"person":[155],"newsletter-type":[],"ticker":[],"class_list":["post-23666","post","type-post","status-publish","format-standard","hentry","category-market-minute","publication-market-minute","person-mike-burnick"],"acf":[],"ai_tts_audio_outdated":false,"ai_tts_legacy_post":false,"_links":{"self":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/23666","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/users\/100"}],"replies":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/comments?post=23666"}],"version-history":[{"count":3,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/23666\/revisions"}],"predecessor-version":[{"id":24992,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/23666\/revisions\/24992"}],"wp:attachment":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/media?parent=23666"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/categories?post=23666"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/tags?post=23666"},{"taxonomy":"publication","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/publication?post=23666"},{"taxonomy":"person","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/person?post=23666"},{"taxonomy":"newsletter-type","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/newsletter-type?post=23666"},{"taxonomy":"ticker","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/ticker?post=23666"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}