After a brutal week on the averages with the S&P 500 losing 2.8 percent in five straight sessions due to fears of China and the Fed, Jim Cramer was happy that the market finally had a rebound on Tuesday.
"That's why I think it is so important for us to ask ourselves whether the pain has already been baked in," the "Mad Money" host said.
To find out, Cramer turned to Mark Sebastian, a technician and founder of OptionPit.com and colleague at RealMoney.com. Sebastian is also the "Mad Money" resident expert of the CBOE Volatility Index, also known as the VIX or fear index, because it is widely used to gauge the level of terror in the market.
Right now, despite the vicious declines in the past week, the VIX remains at remarkably low levels, dropping below 14 on Tuesday—which suggested to Sebastian that the market might be in better shape than you'd think.