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Even though the Dow stands at all-time highs and the S&P 500 is within a few percent of its all-time highs, the S&P 100 remains 17% below its highs reached 13 years ago. Does it have to do with a 26-year resistance line? I doubt that is the main reason.
Anyone have a good explanation why this is happening? Regardless of the reason, from a Power of the Pattern angle, the S&P 100 is facing a 26-year resistance line right now that is tied into the 1987 highs and 2002/2003 lows. This line has been in place for the last 10 years and this is the closest the index has been to this line since it formed.
I shared with Premium and Sector Extremes and Global Dashboard members last week that the Rydex/Silly Money Ratio is hitting levels last seen back at the 2007 highs, reflected in the chart below.
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Why do I call it “Silly Money?” Because the Rydex investors have done some Silly things at key highs and lows over the past few years! At market lows (shaded in Green) they had low exposure to bull funds and at market highs (shaded in Red) they have had large exposure to bull funds. Now the ratio is hitting levels last seen back in 2007.
Should investors “Exit Stage Right?” No!
Should investors know where the Exit Door is due to the pattern in the top chart and the Rydex ratio? Yes!!!
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I read it a little differently: S&P 500 struggling to confirm a new high made by the Dow, & SP 100 having an even harder time of it. The S&P 100 remains 17% below its highs reached 13 years ago. Nasdaq is even worse yet. Non-confirmation Divergences can be seen everywhere. Cash in Mutual Funds is said to be the lowest in history at 3.3%. Large EW pattern near completion, or was just completed in the night time hours with a dia. tri. 5th wave. March 27 is full moon and has 3 Fib. trading day alignments. A good place for a sizable correction.
OK…my interest is peaked! So, where IS the exit door? Is this thing going to just keep bumping up along that line?
belsha…
could be related to US$Dollar.
small caps less dependent on exports
dollar up could hurt exports thus large caps lag…
great chart! I exited a little to early based on a trend line I had charted of an upper rail of resistance from the ’00 & ’07 highs. Wishing now I had hung in a little longer because it looks like we could keep sliding on up 17% more…thanks for your work
Considering that the Russell 2000 is well above it’s 2007 highs, which in turn where well above 2000 highs, it seems quiet logical that we see the opposite behavior in the SP100, while the SP500 has been flat. This simply indicates that small and mid-caps have largely outperformed the larger capitalization’s. Not sure what the economic message is, but it could be positive, meaning that the grassroots economy (small businesses) is in far better shape than the highly financiarized, globalized economy of large corporations.
The average daily volume on the big board has been running at below 500Million shares per day for a very long time.The other day it was barely over 400M shares.At one point in time the average daily volume was over a billion shares.Why is the silly money indicator so high with such a low volume?????
Looks excellent, wait to be seen. Soon.