When Staple sector (i.e. defensive) stocks started to reflect greater relative strength than Discretionary sector stocks back in 2000 and again in 2007, the S&P 500 began to fall dramatically in the ensuing months. That’s happening again. Can a collapse of the S&P 500 be far behind?
The above are edited excerpts from an article* by Chris Kimble (blog.kimblechartingsolutions.com) entitled This took place in 2000 & 2007…happening again? Defensive time???.
The following article is presented by Lorimer Wilson, editor of www.munKNEE.com (Your Key to Making Money!), www.FinancialArticleSummariesToday.com (A site for sore eyes and inquisitive minds) and the FREE Market Intelligence Report newsletter (register here; sample here) and has been edited, abridged and/or reformatted (some sub-titles and bold/italics emphases) for the sake of clarity and brevity to ensure a fast and easy read. This paragraph must be included in any article re-posting to avoid copyright infringement.
Kimble goes on to say in further edited excerpts:
A look at the ratio of Staple to Discretionary sector stocks in the chart below shows that it is on the verge of breaking up through resistance once again. That suggests that a collapse of the S&P 500 may only be weeks ahead. While nothing is proven at this time, it sure has my attention !!!
Editor’s Note: The author’s views and conclusions in the above article are unaltered and no personal comments have been included to maintain the integrity of the original post. Furthermore, the views, conclusions and any recommendations offered in this article are not to be construed as an endorsement of such by the editor.
Copyright 2014. All Rights Reserved.)
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