The VIX jumped 21.5% on Friday as the S&P 500 fell 1.09%, but history suggests such spikes usually fade by Monday. Bitcoin's steady weekend trading above $80,000 points the same way, though the history offers no guarantee.
The VIX jumped 21.5% to 19.99 on Friday as the S&P 500 fell by 1.09%. Stocks dropped on AI and geopolitical worries, and CoinDesk's read of past data suggests the panic could fade as quickly on Monday.
Friday's VIX surge
Cboe's VIX measures how much traders expect the S&P 500 to swing over the next four weeks. It is derived from options prices. Friday's move was the biggest one-day rise since June 5, according to TradingView data, when the S&P 500 suffered its worst day in months.
Traders are betting the VIX stays high. CoinDesk, citing CNBC, says traders bought 9,200 of the Nov. 18, 20-strike calls for $1.7 million. They also bought 12,500 of the Nov. 18, 23-strike calls for $1.1 million, a bet that the VIX closes above 23 by the third week of November.
Friday VIX spikes usually reverse on Monday
However, the VIX has jumped 20% or more on a Friday 32 times since January 1990, according to CoinDesk's analysis. The next Monday, it fell 25 times and rose seven, and the typical Monday move was a drop of 4.5%.
A month later, the VIX was lower in 25 of the 32 cases, with a median drop of 16%. Seasonality points the same way: the VIX has declined in November in 25 of the last 36 years, with a median drop of 7.2%.
Bitcoin holds above $80,000
Bitcoin, meanwhile, continues to trade above $80,000 within its recent choppy range. Because it trades over the weekend, swings in bitcoin are often seen as lead indicators of how traditional markets may open on Monday.
Volmex's BVIV, the bitcoin volatility index, slipped 1% on Friday to just under 40% and has barely moved since. Polymarket bettors see just a 9% chance the AI bubble bursts this year, as of CoinDesk's writing.
The pattern is not a guarantee
In seven of the 32 cases, the VIX kept climbing sharply on Monday, including in August 2015, February 2018 and August 2024. The VIX also remains under 20, a mark it has topped on more than a third of days since 1990.
Source: CoinDesk
Trading involves risk.
Risk Disclaimer
