📈 VIX: From “Calm Tension” to a Rebound

Why does a small uptick matter today… if we’ve already seen 60+ readings four times in the past 17 years?

The first week of August 2025 brought back a familiar market force: volatility.
The VIX, which tracks expected fluctuations in the S&P 500, jumped 21% in just a few days, rising from 17.4 to 20.37, with an intraday high of 21.9 on August 1.

At first glance, the move may seem minor. But it broke through key long-term moving averages (SMA 50 and 200) and exited its recent comfort zone (14–19 pts). That alone is enough to make portfolio managers and traders pay attention again.

🔙 Historical context: when the VIX truly spiked

Compared to those moments, today's VIX levels look “mild.” But the technical and macroeconomic signals suggest that volatility may be establishing a new baseline.

1. 📊 Breakdown: First week of August 2025

• Weekly increase: from 17.4 → 20.37 (+21%).

• Technical breakout: monthly close above both the 50-day and 200-day simple moving averages (SMA 19.25 and 19.45).

• MACD on the monthly chart has flipped positive for the first time since March 2023.

• Key drivers:

  • 🏛️ The Fed left interest rates unchanged on July 30, but two dissenting votes favored a rate cut.

  • 👷‍♂️ Softening jobs data: July NFP came in at only +73,000 jobs (vs. +110,000 expected).

  • 🧾 New U.S. tariffs, announced on August 1, reignited inflation concerns.

2. ⚖️ Comparing August 2025 to the August 2024 storm

Conclusion:
2024 was a systemic shock.
2025 is more of a volatility warning sign—but one that matters for risk management.

3. 📍 Technical signals to monitor

• The monthly MACD just turned positive, which historically precedes sustained volatility spikes.

• Key short-term range: 18–22 pts. A sustained close above 22 could trigger heavy selling in high-beta stocks.

• Options expiration (OPEX, Aug 16) may amplify moves via gamma flows.

4. 🔮 What could move the VIX next?

5. 🛡️ How to navigate this “new volatility plateau”

• Cheap hedging: consider buying VIX call spreads (22/30 for Sept expiry) if the index drops back to the 18–19 range.

• Avoid naked premium selling: as long as the VIX is ≥ 20, opt for defined-risk structures like put spreads.

• Shift gains into cash/T-Bills: if CPI surprises to the upside, safe haven rotation may be warranted.

📌 Note: The VIX cannot be traded directly. Exposure is typically obtained through futures, options, or ETNs—each with specific risks like contango, low liquidity, and roll decay.

📌 Final thoughts

The VIX doesn’t need to hit 60 to send a message.

The fact that it’s breaking above long-term averages, reacting sharply to macro data, and threatening key levels is enough to suggest that the era of ultra-low volatility may be ending.

History shows us that major VIX spikes come fast and unannounced.
If you remember 2008, 2020, or even April 2025—you know that preparation beats prediction.