Stock Market Volatility Looks Set To Increase Ahead Of Key Fed Decision: This ETF Tracks The VIX

The Volatility S&P 500 Index (VIX), tracked by the ProShares Ultra VIX Short Term Futures ETF UVXY, and other tickers, bounced slightly on Friday, which Benzinga pointed out was likely to happen on Thursday.

Volatility in the stock market may pick up ahead of the Federal Reserve’s decision on interest rates, which is set to be announced on June 14 at 2:00 p.m, which is followed by Fed Chair Jerome Powell providing a statement.

Traders wishing to play the potential volatility in the stock market can use MIAX’s SPIKES Volatility products. The products, which are traded on SPIKES Volatility Index SPIKE, track expected volatility in the SPDR S&P 500 over the next 30 days.

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The VIX Chart: The VIX printed a doji candlestick and an inside bar on Friday, which suggests a bounce may continue on Monday. While the doji candlestick leans bullish for the short term, the inside bar leans bearish because the VIX was trending lower before forming the pattern.

• The VIX’s most recent lower high was formed on May 31 at 18.40 and the most recent confirmed lower low was printed at the 14.42 mark on June 2. If the VIX bounces on Monday, Friday’s low-of-day may serve as the next lower low within the pattern.
• Traders who are bearish on the stock market want to see the VIX react to a possible double bottom pattern on the VIX formed near 13.50, which could cause the index to spike up and negate its downtrend. Investors bearish on the index want to see the VIX top out under 18.40, which could confirm the downtrend will continue after a temporary bounce.
• The VIX has resistance above at 14.10 and 15.69 and support below at 12.09 and the psychologically important 10 mark.

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