My hero and mentor Sir John Marks Templeton used to say…The four most dangerous words in investing are-“Its Different This Time!”

Basic Materials ETF (IYM) and High Yield ETF (JNK) have created a series of lower highs since the 500 hit its highs last April, along line (1) and have both broken support of late.

In the past weakness in these sectors was reflecting some underlying weakness in the broad markets!  Will it be different this time around?  I humbly don’t know! 

What we do know is this….investing is an art, not a science.  I do believe the action of these two are key signs for what could be going on behind the scenes and their price action should be respected!  Keep a close eye on these two to see if they continue to experience relative weakness.

How The Recent Decline In Stocks Looks "Eerily" Like Major Bear Markets Of The Past