XLY is an ETF that tracks the consumer discretionary sector, which is an offensive sector that takes the lead in risk-on, growth-on environment, Alternatively, XLP tracks the consumer staples sector, which is more defensive as it consist of large companies selling products that is widely essential to consumers, and thus has a more stable revenue stream, and thus tend to outperform XLY in times of uncertainty.
The ratio is has started decline, favoring the staples sector, the latest two market crashes of 2000 and 2008 was preceded by this behavior, however, it wasn't that fast or direct every time, as the ratio started to lag the SPX for more than 2 years before 2008 market drop. In any case, failure to make new highs for the ratio in the upcoming period will be a major bearish signal. Bears will be rewarded big time should they wait for a bearish confirmation sell signal.