Volatility can be the friend or the enemy of a trader, and it’s good to know which one. Like prices volatility follows cycles of expansion and contraction. Volatility expands, then contracts, then expands, and lives this cycle over and over again. The volatility extreme indicator is the result of years of volatility study on the relationship between price and volatility specifically on the Emini S&P 500 Futures contract. It’s often at extremes in the market, that price can no longer continue, and an immediate reverse is a high probability. The Volatility Extreme Indicators will help you identify these periods on the chart.
