I would use extreme caution with this approach unless the VIX is...

I would use extreme caution with this approach unless the VIX is in the very low teens..
If you bought at any of the lows on the VIX, you would have pretty much 'got in' at the top end of each bounce and then been smashed to the downside.

If you plan on using the VIX and going long, you're better off buying at the top end of the range when you see price decreasing.

A better strategy would be not putting on longs at all into the bounces and putting on shorts instead when the VIX is at the bottom end of its range.


This all depends on your view of the market of course.
- If you believe it's going down further then shorts at the bottom end of the VIX range are probably the best option.
- If you believe the market is going higher then Longs at the top end of the VIX range would be your option.


AXJO - Daily Chart

As you can see you if you bought when the VIX at it lows you would of smashed..