Prerequisites for a mega-crash:
Backtest the volatility trend line amid massive short-covering.
"Check"...
10% historical odds of "winning" in the 4th quarter, when entering at a loss
Volatility with momentum aka. "Deja vu"
The market has gone nowhere for 12 months (dotted blue line)
A head and shoulders top has been formed. Solid blue line is neck line
Overlapping waves = no momentum (red line)
The left shoulder had peak momentum, whereas this latest "rally" (sideways churn) barely even registers...
Price / Volume (30 dma)
One year later, and they're still buying the delusion. Some people really like to learn the hard way:
Heightened volatility is precursor to recession:
20 year Volatility (VXO):
