In my 2017 Market Wrap-Up post, I referenced major support (200) and resistance (280) as levels worth monitoring on the SPX:VIX ratio, on a monthly timeframe.
The following updated monthly chart of the SPX:VIX ratio reveals a few interesting things:
- All of the monthly closes since July 2017 have been above 225.
- December ’17 and January ’18 have spiked above the 280 resistance level, but not yet held above.
- A long-term uptrend line (heavy blue arrow) indicates near-term support around 225, at the moment.
- 225 is confluent with a major external Fibonacci retracement level at 228, as well as the bottom of the original long-term uptrending (green) channel.
- In my post of February 24, 2017, I identified 200 as a new level to be held above, in order to support a new bull market in equities.
- In April, 2017 we started to see closes above 200 (the next monthly chart shows the SPX in the upper half and the monthly closes (in histogram format) of the SPX:VIX ratio in the lower half, for a different perspective).
- Monthly momentum on the SPX:VIX ratio began to weaken last November, which hasn’t supported the price breakout on the SPX above 2600.



