Watching quotients can give a good edge about the market

This time is AMEX:SPY / AMEX:UST which compares the U.S. stock market with the U.S. bond market. So, right now is heading to test a very strong resistance in 5.20 points, while for the last few weeks is been divergent from its RSI , all "selling signals". Normally when this quotient gives this signals is because the stock market is losing strength and a correction is on the way because the "smart money" is selling stocks to buy bonds.

There's no way to predict how strong could be the correction or even if it will happen, the best thing you could do is to rise stop-loss, sell extended stocks and low stock positions. That is what I have been doing.


The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.