Traders Maintain Bullish Bias; Volatility Measure Falls Again
Dow Jones Newswires</br></br>NEW YORK -- Volume started to fade in the final trading session before Christmas, but investors' high hopes showed no signs of flagging.</br></br>Many continued placing bullish bets, encouraged by economic data showing a rise in durable-goods orders and consumer-spending growth. At the International Securities Exchange, investors were buying about 2.27 new calls for every new put -- after a brief pause when that number dipped below two for the first time this month.</br></br>The Chicago Board Options Exchange volatility index, or VIX, eased 0.22 to 11.23. This 30-day forecast of stock-market volatility has fallen in 13 of the last 17 sessions, for a 15.4% decline this month. This slow and steady ebb toward new nine-year lows is another sign that traders looking ahead for possible stock-market threats believe all is calm.</br></br>But futures on the VIX indicate traders believe the market might become more volatile soon -- at least when companies begin reporting earnings in January. Recent futures prices show traders believe the VIX might rise to about 13.4 at mid-January, 14.5 at mid-February and 15.9 at mid-May.