As the market keeps going higher and higher, Jim Cramer and the chart watchers are boggled. What the heck is going on with the CBOE Volatility Index, a.k.a. the VIX or fear index?
The VIX is the index that shows the fear for the market's expectation of 30-day volatility. The idea is that a low VIX is good news, because it indicates a low amount of fear of an inflammatory market.
So here is the issue: The volatility index is at historically low levels right now, at $12.25, and that's great…right? Maybe.
What is strange is that the S&P ended near record highs on Tuesday, yet the VIX is more than two points higher than where it was the last time the S&P was making new highs.
To find out what is going on, Cramer went off the charts with Mark Sebastian, technician and founder of OptionPit.com to find out why traders are less comfortable with this rally. Sebastian thinks it is a simple answer: U.S. markets have a lot of noise around them right now.
When Sebastian took a look at some of the specialized indices of the VIX, he sees that the volatility index is headed lower into the end of the year. This could suggest that the stock market has more room to run.