Explanation: XLY is an that tracks the consumer discretionary sector, which is an offensive sector that takes the lead in risk-on, growth-on environment, usually leads in early stages of of economic expansion environment and following crisis. which was the case since 2009. and lags in late stages of market and .
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, therefore it tends to outperform XLY in late stages of economic cycles and early stages of economic contraction and under risk aversion.
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.
Note that XLY has started to lag XLP since February
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My guts tell me we will see a sell-off before that, but i have to admit I am dazzled about the strength of the bull.