NEW YORK (TheStreet) -- The CBOE Volatility Index (VIX.X) continues moving lower on Tuesday. Mark Sebastian, head of trading at Swan Wealth Advisors, told TheStreet's Jill Malandrino that with the VIX down 6.5% to $14.28, he's "shocked" to see the stock market react to the current situation in such a bullish tone. 

Recent economic data have been quite weak and the Federal Reserve plans on keeping its monetary policy unchanged, he said. He attributed the rebound in U.S. equities to the stabilization in the Japanese yen and in emerging markets. 

However, the days of the VIX trading at or below $12 may be gone. According to Sebastian, the "new normal" for the VIX may very well be in the $14 to $16 range. 

He added that the long-term "normal" is near $17.50, while the actual long-term mean is closer to $20. 

To put it simply, equity markets are "normalizing" near current levels, Sebastian said. The VIX has been highly volatile, as expected, jumping from $14 to $21 and back to $14 all within two weeks.  

-- Written by Bret Kenwell in Petoskey, Mich.

Bret Kenwell currently writes, blogs and also contributes to Robert Weinstein's Weekly Options Newsletter. Focuses on short-to-intermediate-term trading opportunities that can be exposed via options. He prefers to use debit trades on momentum setups and credit trades on support/resistance setups. He also focuses on building long-term wealth by searching for consistent, quality dividend paying companies and long-term growth companies. He considers himself the surfer, not the wave, in relation to the market and himself. He has no allegiance to either the bull side or the bear side.

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