Call buyers are dominating this strange market and I feel that there should be more fear than what is present. The VIX spot price is below 15 points and is trading near a key support level. I remain bullish on the VIX, as I do not think that it is currently pricing in the uncertainty that is present in the market. I will be watching for a rise in the VIX which will imply higher implied volatility on SPX options, hence rising options prices. I am expecting movement in the S&P in the near future as soon as a catlyst is exposed. Whether the catalyst is Euro fears, QE3 or the election, I am looking to buy vol.

As you can see from the chart below, the spread between the VIX and S&P is relatively tight. Based on the chart I think that this spread is about to widen.

David Cornes holds a degree in economics from the University of Montana.