10-In-A-Row For Dow As VIX Plunges To New Cycle Low

Tyler Durden's picture

If it's a day of the week ending in 'y' then sure enough the Dow is green - 10 days in a row - best run since Nov 1996. The cash S&P's all-time high remains a day or two away at 1576.1 but today's late-day ubiquitous idiocy (first via VIX and then via HYG) took it within a point of the all-time closing high of 1565.15. Volume - take a guess! Trannies outperformed as 4 different stocks were short-squeezed this time to drive half the index's performance (CNW, R, KSU, and UNP). VIX daggered lower to new cycle lows ending at 11.05% at its lows. Away from that tom-foolery, stocks were 'supported' by USD weakness as GBP ramped higher on pre-budget excitement and EUR just because why not; Treasury yields ended the day near the lows of the week - entirely in keeping with the highs of the week in stocks... USD weakness helped WTI rise on the day - now best performer on the week among the commodities with Silver lagging on the week (while gold limps higher). Just another day in dystopia... ahead of the CCAR Part 2.

 

Trannies won but the S&P made a decent run at it into the close before dumping back towards VWAP...

 

Treasury Yields at the lows of the week, stocks at the highs and gold flip-flopping between the two...

 

S&P 500 futures remain in trend as volume drips away...

 

There was one thing that was different today... shorts worked.. for the first day in a while, the Russell 3000's 'Most Shorted' index sold off AND the Russell 3000 rallied... is the squeeze starting to end?

 

 

and while VIX is at cycle lows - it is not 'cheap' per se relative to realized vol which has the hand of bernanke (or Henry) wrapped around it as we inch higher. Implied and Realized Vol have followed a 'typical' pattern of dropping together, anxiety kicking in and protection bid, a scramble back as the rally proceeds and now the real test as we typically see protection bid once again...

 

Charts: Bloomberg and Capital Context