On April the 26th I produced the chart below, suggesting to “fear the techs” and that investors should harvest gains due to the “LACK- OF- FEAR” spread between the Nasdaq 100 and the VXN index. This post took place one day after the high (so far this year), harvesting at a decent price point, as the Nasdaq declined over 15% in the next 60 days. (see post)
For those willing to scoring on defense, more “pocket change” was gathered on the decline. In the post below, I shared that a “Bounce” was due in the Nasdaq at support and to buy the NDX 100. (see post) Picked up more “pocket change” on this bounce, a quick 4% in four days. (see post)
In the chart below I wanted to update the “FEAR/GREED SPREAD” for the NDX 100.
As you can see in this chart the NDX 100 is within a few percent of the April highs, yet the VXN isn’t nearly as low, suggesting that investors aren’t as bullish now as they were at the April highs.
Bottom line…Based upon the “GREED SPREAD” this leading index most likely has more room to run on the upside. For those that are long this index, DO NOT HARVEST the NDX 100. Keep a 4% stop in place.