Thursday, October 29, 2009
Other Indices Fading Away in Latter Half of Rally Today
Just a quick note: notice the attached chart (click on it to enlarge) shows the Dow, S&P, Nasdaq Composite and the Russell 2000. All followed suit with a straight line up this morning, but the riskier the index, the less enthusiastic the second half of the rally has been. You can see the "tipping over" effect as you look from left to right at the trajectory blue and red lines I drew on the indices. This shows that the higher risk assets are loosing steam, and they tend to lead the way. Now this can be resolved if they all charge higher at any time, but as of right now it shows a lack of confidence in the second half of this rally today which may be signal of the near future. I'm not calling a top here, although certainly possible, it's just something to watch as this rally unfolds.