Why are market analysts constantly warning about VIX levels? How exactly does that impact the Nifty?

In the last four weeks, the Volatility Index (VIX) has moved up sharply from 20 to 70. This has coincided with the fall in the Nifty. Let us first look at what VIX is all about? VIX is the volatility that is implied in the option pricing. Instead of just a single strike, a series of strikes around the spot price are taken and the IVs are averaged to arrive at the VIX. The VIX is also called the fear index as it shows the amount of fear implicit in option pricing. One of the most important relationships to understand is the one between the VIX and the Nifty levels. Historically, the Nifty and the VIX charts have moved exactly opposite to each other. VIX level of 20 and below are considered conducive to up move in the indices. VIX has largely been in the region of 12-16. At these levels, the markets are seen as safe and any correction is soon met with interested buyers. In other words, you can say that downsides are limited. When the VIX crosses 50 that is when the sharpest corrections are visible in the midst of a spike in volatility.