As mentioned yesterday, the Volatility Index peaked at 33.70 before settling to 30.30. It last reached such levels in March 2008. It indicates that the market is reaching a capitulation stage, the emotional point where investors are surrendering to the markets.
I found a practical description for capitulation on this blogger's site.
Fibonacci lines indicate the VIX will settle at around 20. Markets are going to establish a trend line before potentially moving upwards again. Investors should compile a list of well-valued stocks in the appropriate sectors and should even placing positions in them.
