By a rule, any index volatility is indirectly related to its main index. This means if the index rises then the volatility index falls and vice versa. This was true when S&P 500 rose from March 2020 to Jan 2022 and the reverse was true during the fall from Jan 2022 to October 2022.
But since December 2023 this pattern has not behaved normally as it should. During the last 500 points rise in the S&P 500, the VIX has remained within the same range of 12.8 to 14. In a normal reaction, it should have gone near 10 if not below.
A similar disconnect is visible in the US 10-year Bond yield and MOVE( bond VIX ). Also in recent weeks, it has been visible in Crude oil and OVX ( crude oil VIX). All these disconnects generally have occurred in past just before large moves in the VIX in a short period.
Will it repeat itself and result in a large correction in equity indices along with a rise in yields and crude oil prices? The answer to this might unfold over the next few weeks. But it is for a certainty that the current low level of volatility might not stay for long giving it a high probability of a spike from here.
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