Volatility States
ContextAlongside the market regime, Signal52 tracks the daily volatility state — whether market volatility is compressing, stable, or expanding. This second dimension refines how you should interpret signals and size positions on any given day.
Check the current volatility state alongside the regime in AI Insights, published each evening.
View Today's Volatility State →Compressing
Volatility coiling — pre-breakout conditions
VIX declining or flat at relatively low levels. Market is coiling energy. Classic setup for breakout environments — momentum and breakout signals are most actionable in this state.
Stable
Normal conditions — standard signal interpretation
Volatility within expected ranges with no clear directional trend. Standard signal interpretation applies. This is the baseline state where historical signal edge is most consistent.
Expanding
Rising volatility — wider swings ahead
VIX rising, intraday ranges expanding, and market showing heightened uncertainty. Risk signals deserve elevated attention. Entries require tighter confirmation and wider stop considerations.
Regime + Volatility Together
How to read the two context layers as a combined signal
Maximum setup quality. High-conviction DNA + Action combinations in this combination historically yield the strongest outcomes.
No edge in either direction. Stock-specific setups matter most. Look for the highest signal confluence before acting.
Worst combination for long setups. Even top-tier scores carry elevated risk. Defense and cash preservation are the priority.
Volatility state is derived from the CBOE Volatility Index (VIX), sourced daily from FRED. The classification uses the current level, direction, and rate of change relative to recent ranges — not a fixed threshold. This ensures the state reflects current conditions dynamically rather than applying static cutoffs.