If you been following my monthly updates on the SPY, you know that I've been long since 2012, and continue to be long at the moment. However the above chart kept me up all night this past weekend . This is the SPY adjusted with USD. It was brought to my attention by a good friend of mine. Looking at it , we can see that the ratio between the two has reached the top, back in July 2014. One could say that investors have slowly moved money away from stocks to the USD, which is currently one of the best (if not, the best) performing assets right now .
What do you think ?
Cheers
Algo
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CosmicDust
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Here is my two cents...
Technician
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Nice chart mate. Opposedly, i have been bearish equities for more than year now. It feels like where getting very close to some major break-down in stocks. I would add to your chart these charts
The ratio of NYSE Stocks making new highs over the SPX
The number of stocks trading above its 200-days moving average continues to diverge and deteriorate
The volatility studies of the TLT/SPX which is breaking higher
Algokid
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Thank you Technician , and thanks for the additional analysis. I haven't at the " S5TH " in a while , and it's quickly approaching 60 , which in my book mean close all long position. I wonder what will be the trigger, rate increase ? Unemployment rate ? wait and see i guess
Technician
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Yeah who knows, its a bet. But generally speaking, if we keep things simple, the two main simple fundamentals are worrying: valuations are high, and fed is closer to hike rates, add to that the U.S economy hasn't been doing wow recently.
IanLip
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Algo, awesome call, you were ahead of everyone with this chart and info
Algokid
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thank you for the feedback Ian :)
DallasMav
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Only difference being we are not seeing a equity market panic.
Algokid
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True, wonder if we will see one when/ if the fed increases rates....
I4
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Interesting chart. Glad you shared.
GabrielSebastian
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the equity panic sets in later. Been options trading against the dow for 2 months now winning most losing some. This is classic bubble. The Dow has no steam to get over 18500.00