Photo by Mackson
Another breaking news item that weighed down on the markets today being that of Rajat Gupta's insider trading case that could even be bigger then Bernard Madoff's ponzi scheme! He was charged by federal regulators. Certainly not helping investor's confidence.
As of right now the Dow is trading a whopping 168 points lower so far.
As I mentioned in previous posts a few days ago, the VIX (volatility index; a.k.a the panic index) was trading in dangerously low territory. Under these global market circumstances (meaning the unrest in the middle-east) the VIX trading under 20 is relatively a low number, sooner or later it had to spike up, ...and it did.
It surprised me how even with all the turmoil that has been going on in the world, especially in the oil sector how low the VIX was trading, and how the Dow Jones was hardly affected by all this, booking gains after gains. To me it was almost like; "Does no one look in the other direction (meaning the middle-east) and is seeing what is going on in that part of the world?"
Not only Libya's oil production has literally come to a halt but also in Iraq, one of its important oil refineries was attacked stopping oil production there as well. You really don't need a crystal ball for this, sooner or later this was bound to happen.
The main question is now; where to go from here. The markets are extremely volatile right now, pretty much anything can happen.
Let's take a look at the overall picture first;