We have had some discussion on the fact that the .VIX has not yet spiked in this decline which many would take as the signal of a bottom when it occurs. A blog article quotes a study of the .VXO (the NASDAQ .VIX equivalent) and concludes:

"Bottom line is that when the market falls 10% off of a recent high, and VXO stays below 30%, what was bad gets worse. In every prior instance where VXO failed to climb to above 30%, the market continued lower. The MINIMUM additional downside is another 10%.”

The author then offers the opinion such a spike in the .VIX is not necessary to have a bottom but hedges a bit on the ultimate importance of the bottom. The full blog is HERE.