Bullish Moves In VIX Options Today (3/1/2011)

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Courtesy StockCharts.com
The VIX (Volatility Index) closed up 14.5% today at 21.01. The volatility index measures the implied volatility percentage of S&P 500 options (option price changes). VIX spot is still relatively low compared to the SPX lows in May 2010, but watch oil against the S&P going forward or economic catalysts. According to Bloomberg yesterday, Barclays raised its S&P target to 1,450 and EPS estimate to $93 (Bloomberg). Here's a quote from Barclays' Barry Knapp from the article:

“The market is currently struggling to quantify a new exogenous risk, the political instability in the Middle East and a related oil shock,” Knapp wrote. “However, given the experience of the last decade, our current thinking is that the shock will not be large enough to derail the recovery.”

Could a new "exogenous" risk for the economic recovery be more sellers than buyers? Below is Chris McKhann of OptionMonster going over today's action in the VIX futures options.


Courtesy of OptionMonsterTV