Market Reversal Underway?
Over the past week, there’s been a big non-confirmation of the rally in risk/S&P from the small caps and the transportation index. While the stock market indices have been making new highs, the small cap and transports have not been part of the action. Speculative money tends to flow to these areas when markets exhibit continued strength.
Keep this factor along with today’s 1.5% sell of in the S&P in mind when assessing the macro environment and which way the larger trend in risk is going.
Always trade with the trend (and be careful when the trend changes)
Jon
