As you can see in the chart last time a spread between SPY
of this magnitude was during 2000 Tech Bubble Peak. What you might also notice is the fact that in 2000, Euro
bottomed while SPY
hit an all-time high. If price action repeats we should see Euro
capitulate and higher highs or a flat top for S&P 500 Index
/ SPY ETF
. After SPY-Euro divergence is maximized the two would later reach an equilibrium.