The Dow Jones Industrial Average has no real chance of going higher in the near term if the VIX index shows increased volatility, Chris Zwermann, global strategist at Zwermann Financial, told CNBC Wednesday.
"If the VIX really is breaking out to the upside, then the Dow Jones really has no chance to spill over and go higher, direction 12,000," Zwermann said.
Without the volatility spike, and if the Dow is able to push to 11,260 points, then it could rally toward 12,800 points, he said.
However, a move higher in the Dow would be "only corrective so far," according to Zwermann. The Dow is at risk of falling toward 9,600 points, he said.
"Just for the short term situation, in the next say two weeks, you should be very careful because if the VIX goes higher here we have some kind of a turnaround," Zwermann said.
Zwermann also takes a technical look at the yen versus the dollar.