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RUT & SPX

Discussion in 'General Discussion' started by Trader G, Sep 16, 2014.

  1. Trader G

    Trader G Well-Known Member

    I know they have different vols and aren't tightly correlated but is anyone else seeing a divergence in the SPX and RUT movement? Since the Jul highs RUT hasn't gotten close while SPX did get back up. Even today, RUT isn't participating in the up surge with SPX. Just curious how you guys read it. Is it a sign that money is flowing in to the bigger stocks, is the SPX being propped up, are there a few big names in SPX holding it up? Let me know what you guys think
     
  2. jim

    jim Administrator Staff Member

    There has been a big change in the leadership of the markets within the last few months. While the small caps had led us higher since the 2009 lows, large cap has clearly been the leader this year. In addition I also see the leadership narrowing to fewer and fewer stocks... This is normal in late stage Bull markets.


    Sent from my iPad using Tapatalk
     
  3. jim

    jim Administrator Staff Member

    Two important points to add for tomorrow's morning:
    1. In the SPX, the 150 days simple moving average may be challenged again tomorrow morning. if it is breached to the downside, we could see a 10% pullback.
    2. Today, our "Danger Will Robinson" 9/90 day indicator increased OVER the worst level in more than a year.
    Traders bewares. I will review these indicators in detail tomorrow evening at 8:30 PM Eastern in the Capital Discussions Trading Group meeting
     

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