The Chicago Board Options Exchange (CBOE) Market Volatility index (VIX) measures options activity within the market and is widely used tracking the S&P 500. A common trading strategy for traders and investors includes a VIX level of 30 or above means an immediate switch from equities to cash. Traders and investors are retreating from the markets and finding safety and protection within the Treasuries, gold, and the dollar.

As long as we stay above this level expect pessimism as we approach the slow summer months. Currently the VIX is above the 144 and 200 day moving averages on the daily chart. The index is at the 29.46 as of Thursday June 3rd so traders and investors may be inclined to switch to equities and cover their shorts.

However due to the low volume in the recent rally and liquidation of mutual fund investors due to frightening instances such as the