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VIX and S&P 500: Why Bears Should Be Worried

VIX and S&P 500: Why Bears Should Be Worried

CoinomediaCoinomedia2025/04/19 23:00
By:Isolde VerneIsolde Verne

Historically, VIX spikes above 60 have marked S&P 500 bottoms. What does this mean for the current market cycle?History Says High VIX Means OpportunityBearish Sentiment Could Be PeakingWhat to Watch Going Forward

  • VIX spikes above 60 have historically signaled SP 500 bottoms.
  • Bearish traders could be caught off guard by a major reversal.
  • Volatility often peaks before market recoveries begin.

History Says High VIX Means Opportunity

If you’re betting against the market , you might want to look at the VIX and SP 500 correlation before going all in. For the last 35 years, every time the VIX—the market’s fear index—has spiked above 60, the SP 500 has found its bottom soon after.

The Volatility Index (VIX) is widely viewed as a real-time measure of investor fear. While high readings often reflect panic, they’ve also historically signaled moments of maximum opportunity. In fact, past data shows that when the VIX crosses the 60 mark, it typically precedes a strong rebound in equities.

Bearish Sentiment Could Be Peaking

The phrase “this chart will be painful for bears” couldn’t be more accurate right now. Many traders are shorting the market, expecting further declines. But if history holds true, they might be caught on the wrong side of the trade.

During previous crises like the 2008 financial crash and the COVID-19 selloff in 2020, VIX spikes above 60 closely aligned with major bottoms in the SP 500. Once the panic peaked, stocks began to recover—fast.

This recurring pattern suggests that extreme fear doesn’t just spell trouble—it might actually mark the turning point for bullish investors.

This chart will be painful for bears.

VIX above 60 has marked the perfect
SP 500 bottom in the last 35 years. pic.twitter.com/Pz8TrlXKKc

— Ash Crypto (@Ashcryptoreal) April 19, 2025

What to Watch Going Forward

The takeaway? Keep an eye on volatility. While a soaring VIX can seem alarming, it often represents capitulation—the point where fear is highest and selling is exhausted. For savvy investors, that could mean it’s time to position for the next leg up.

The VIX and SP 500 relationship is a reminder that markets are cyclical, and sometimes, maximum fear leads to maximum profit—for the bulls, not the bears.

Disclaimer: The content on CoinoMedia is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency investments carry risks, and readers should conduct their own research before making any decisions. CoinoMedia is not responsible for any losses or actions taken based on the information provided.
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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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