Financial Stress – Low Low Low Low Low…

The following charts show an alignment between the dominant cycle in the VIX index (daily) and the dominant cycle in the St. Louis Financial Stress Index (weekly):

St. Louis Financial Stress Index Dominant Cycle

St. Louis Financial Stress Index Dominant Cycle

VIX and Financial Stress Index Dominant Cycle View

VIX and Financial Stress Index Dominant Cycle View

5 replies
  1. WTT says:

    I was asked how to trade this signal on a short-term basis. Here is a very basic way to trade it:
    Just go long the VIX ETF one day after the signal and exit one day after the cycle swing index gave a turn above the upper range. It is the basic strategy teached in Book 1 “Dynamic Cycles”. A very basic +10% profit trade in just one week with clear entry and exit signals:

    Trade Example

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