A quiet VIX and fresh record highs can tell a bullish story
Take a step back from the daily headlines and the market has been rather boring lately. The S&P 500 Index SPX notched its 27th all-time high of the year on 8/13, and the very next session the Cboe Volatility Index VIX slipped to 14.25, its lowest close since early January. In this business, boring is usually a compliment. That doesn’t mean risk has vanished, but it is worth unpacking what a quiet market is actually telling us.
Nothing to See Here…
The clearest read on “quiet” comes straight from the VIX itself. After spending most of July bouncing between 17 and 19 on tariff and rate-path headlines, the VIX broke decisively lower in early August and has spent the last two weeks carving out lows not seen since January, briefly dipping under 14.2 intraday. That is well below its roughly 19.6 long-run average (since the start of 1990) and just one box above its 52-week low on the 1-point chart. That chart shows the VIX in a negative trend since March, on two consecutive sell signals with a potential third that could be seen if the VIX breaks below $14. Even with a decline in stocks on Tuesday, the 1-point VIX chart has not even reversed up.
The setup mirrors what we flagged in the SPX Volatility Study last month: the percentage of 1%+ trading days has been running below its historical average for most of 2026, and the market has been rewarding that calm with a steady grind rather than a volatile one. None of this is a coincidence — it lines up neatly with the SPX push through 7,800 for the first time.
The Market Keeps Making All-Time Highs
The 27 record closes SPX has notched this year sound like a lot, and headline writers have certainly treated the count that way. But viewed against history, 27 is closer to ordinary than extraordinary. If we look at data since 1950, the S&P 500 averages close to 18 all time highs a year. However, there have been many stretches throughout the decades with consecutive years of no all-time highs, typically following major bear markets. The latest stretch came from 2001 to 2012, where 2007 was the only year to see fresh highs. If we only look at data from 2013 forward, SPX averages just over 33 new all-time closing highs a year. As we can see from the graph below, the variability around the averages is large. 2021 produced 70 new highs (the second-most on record behind 1995’s 77), and 2024 produced 57, while 2022 and 2023 combined produced exactly one. New highs, in other words, come in clusters tied to secular bull markets, not in a steady drip every year.
What Happens When We Make ATHs While The VIX Is Low?
The more interesting question isn’t whether new highs are normal — it’s what happens when a new high shows up alongside a genuinely quiet VIX, the exact combination we have right now. Just looking at new all-time highs since the beginning of 1990 leaves us with 791 days that saw the market close at highs, or about 8.58% of trading days. We can filter that down further to eliminate days inside of the same 10-trading day (two week) window, which brings us down to 101 days.
Over half of those instances occurred when the VIX was below 15 (54 times). Over a quarter of days occurred when the VIX was between 15 and 20 (27 times). The remaining 20 days occurred when the VIX was between 20 and 35. Forward returns from those buckets tell an interesting story. The market tends to do well after reaching new ATHs while the VIX is below 30, and the returns only improve as time expands. The average SPX is positive 80% of the time six-months out from the 54 instances.
A quiet tape, with VIX sitting on a sell signal, and 27 record highs that are essentially right on the long-run average for recent years. This does not have the making of an overheated market. If anything, the historical record on this specific combination argues for a bit more patience with the current uptrend rather than less. We’ll keep watching the VIX chart, along with breadth and positioning data, for the point where that changes.
