Today Citibank analyst, Tom Fitzpatrick, told King World News that despite the recent pullback, gold is headed to new all-time highs. Fitzpatrick, a 28 year veteran and top analyst at Citibank, which has $1.3 trillion in assets, also said that stock markets will continue to head lower in the coming weeks. But first, here is what Fitzpatrick had to say about the volatility index: “We’ve broken above that resistance level at 21% on the VIX, completing what is a very clear inverted head and shoulders within the daily chart. That suggests we could easily get a move that could take us up to something in the region of 27% to 28% (on the VIX).”
“The longer-term chart might even suggest a little bit more than that (27% to 28% target) on the VIX, but for the moment that is the interim target. So we are very closely focused on that and the fact that we’ve made a very significant break. By definition it suggest we’re going to continue to see a lower move in the equity markets in the weeks ahead.
To get the VIX moving to those levels, we’ve got to think we could be making a push on the S&P that is going to take us down close to the 200 day moving average. Now the 200 day is currently at 1,278 on the S&P, so it’s a good 40 points lower than current levels. We should at least see a move to those levels to get the VIX in the initial target range.”
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