Both the S&P 500 and Nasdaq-100 Indexes were higher last week. Neither VIX nor VXN followed the typical inverse relationship with the underlying indexes and actually finished the week higher as well.
On the open Friday, the S&P 500 was higher and VIX was under pressure trading around 13.50. I saw several twitter comments predicting a 12 handle for VIX before the end of the day. However, it appears even though the S&P 500 continued to finish positive on the day on the day that demand for SPX options picked up pushing VIX to higher levels as well. VIX finished the week at 14.51, up for the day and up just under 1% on the week. VXN held up better than VIX during the week, but did lose value on Friday. Although the implied volatility of NDX options dropped on Friday, VXN was up more than VIX on the week.
A similarity between VIX and VXN trading last week was the shift in each curve. Both spot indexes were higher along with the front month September futures contracts. However, beyond September, both VIX and VXN futures were all lower on the week. The result is a unique curve shift for both markets.
Finally, congratulations were in order for the VIX Futures pit as the CBOE Futures Exchange had record VIX futures volume last Thursday.