The 2012 stock market just before the USA was downgraded by credit agencies showed the same relative strength pattern as the market is today. Defensive sectors are leading. Of course we remember the 20% plunge in the SP500 that followed.
History may not repeat exactly, but is sure may rhyme.
The current SPDR Sector relative strength pattern is below. The defensive sectors like Health (XLV), Staples (XLP) and Utilities (XLU) are leading the current rally for the last 22 days.
Chart Points: When symbols are to the right they lead the relative strength, when symbols are high they have the better trends.
Alert - Risk is elevated. Who says so? The long only funds say so!
Members of readtheticker.com can construct studies like this at ease.
