VIX Decision Time. 3 month rally or -6% correction on stocks?

VIX has been trading within a Channel Down since March 2020, which is natural as the huge volatility spike following the COVID outbreak as a global pandemic has been normalized gradually.

Every bottom on this Channel Down was in the form of a Cup and a spike to the Lower Highs trend-line followed. Every time that was translated into a strong correction on the stock markets.

Right now it is the first time (on the 1D time-frame) that the price broke below this Cup. A break below the Green Line will indicate in my opinion a strong stock market rally for Q3. On the other hand a break above the Red Line may cause a medium-term correction on stocks within -3% and -6%.

What do you think will happen?



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