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S&P 500 VIX Futures - May 24

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16.13
+0.15(+0.94%)
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S&P 500 VIX Futures Discussions

Explain to me: if the market goes down, this should be going up. Right? Why is this down almost 6% today?
And here is just that corner without the superfulous lines (Gann angles): https://www.tradingview.com/x/gn6i0Hgr/
good analysis, thanks for this.
The VIX actually tracks the premiums for OTM options of the S&P500. So traditionally, if the market goes down, the traders load up protection for the downside more fervently therefore the VIX goes up. If the market goes up, traders have no need to/sell OTM options therefore VIX goes down. Also, when the S&P is flat, no traders want to hold options OTM ATM or ITM (losing theta) therefore the VIX usually goes down (decay). On occasion, the market may be flat but let's say traders expect a huge swing down next week; so traders trade theta in exchange for protection, therefore VIX goes up. Also, contango of cash vs futures goes into play as well but that's another story.
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