As noted in NFTRH 445, XLY (consumer discretionary) vs. XLP (consumer staples) has disregarded the 2007 memo and broken its dome upward. That is very un-2007 and a higher high would croak the pattern.
Analysts are using indicators like this and other defensive vs. risk ‘on’ markers to maintain a bullish view, and rightly so. They are celebrating that we do not have a 2007 scenario.
Okay, that’s fine guys. But the big comparison, in so many markets over the last year, has been to the 1999 to 2001 time frame, not the 2007 to 2010 time frame. In 2000 we saw big time upside blow offs terminate the bull market. Just saying…
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