VIX and VXN both reacted to higher underlying markets by moving higher as well. The move in VIX, rising a whopping 0.05 does not offer any significance of insight into the mind of the market other than to say, “Volatility is discounting status quo for the markets”. Of interest was the rise in VIX futures prices which outperformed VIX to the upside across the board.
A couple of things stand out when looking at VXN. First a rise of over a point when the underlying index is making a new high for the year could be considered a cautious signal. I attribute part of this rise in volatility for NDX to where we are in the earnings cycle. Apple (AAPL – 525.96) and Facebook (FB – 51.95) are set to report next week and anticipatory pressure in the option prices of those two stocks can trickle over into the volatility of NDX. However, the futures rose as well so I’m going to place the ‘reason’ for VXN and the respective futures trading higher in the face of NDX as a combination of short term focus on high profile earnings report and longer term concerns about the financial markets.