VIX (VOLX), an index measuring volatility on the US stock market, has rallied yesterday. Volatility spiked as retail traders pumped small-cap stocks and caused big losses for hedge funds with short positions. Unwinding of these shorts was also accompanied with scaling down long positions on large caps and it has pushed the broad market lower. VOLX broke above the resistance at 25.25 and reached an intraday high above 35.50 yesterday, the highest level since the US presidential elections. A pullback can be observed today but the index remains at a relatively high level. Volatility could remain high for as long as abnormal performance of stock markets prevail and it may encourage fund managers to scale back risk exposure even further.
VOLX jumps to the highest level since US presidential elections. Source: xStation5
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