The equity indexes rallied Friday, driving the VIX and its futures lower, on optimism that lawmakers would make progress on avoiding the "fiscal cliff."
The S&P 500 was up 6.55 points at the end of the day, just shy of 1360. It had fallen below 1344 in the morning but finished just off the day's high. Support and resistance remain at 1338 and 1395.
The Nasdaq 100 followed the exact same path, dipping below 2495 but closing at 2534.15, up 9.8 points. It still has support at 2504 and resistance at 2650.
The Russell 2000 finished at its high of the day, gaining 6.8 points to 776.28.
The action had the VIX down 1.58 points, or 8.8 percent, to 16.41, its lowest close in a month. The volatility index had been up to 18.50 but dropped all afternoon at its session low. Part of the decline, of course, is caused by the weekend time decay getting priced into the SPX options on which the VIX is based.
The VIX futures were lower as well. The November contracts have only two days of trading left and lost 1.30 points to close at 16.75. The December futures were down 0.95 points to 18.20.
More than 1.2 million SPX options changed hands, led by 700,000 puts. The VIX options turned over 628,000 contracts, 446,000 of which were calls.
The VVIX Index, which measures the implied volatility of the VIX options, was down 4.5 percent to 90.27. Overall volatility expectations remain muted, especially given the actual volatility and the issues on the horizon. (See related story, " A lack of fear in the volatility index ")
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