Once again the ratio of the percent declines of the NASDAQ and of the S&P500 mirror the disheartening history of the end of the 2000 bull market. This comes just three days after the earlier [NASDAQ/S&P500] change ratio came in at 2.4. Today that ratio of daily percent changes is 2.8.
Our diagram plots these days – revealing 16 such days at that 2000 market high. Further, 13 occurred before that price reversal; these started to happen 43 days before that top; they continued until just eight days before the downturn. In addition, three came one, two, and four days after that high.
The more recent repeats came across the tape on December 19, 27, and 30; then on January 3. Shortly thereafter, on January 15, prices reached their record high. Though none occurred before the next high of March 5, another such day happened just three days ago; and now we have another repeat.
We repeat our warning of March 24: it does not seem reasonable that this simple ratio could be an indicator of bull market tops. Nevertheless, here is its history, showing the overwhelming majority of these closes happening in the twelve-month period from November 24, 1999 to November 2, 2000.Yet note that the 2007 market top occurred without this feature. In fact, the NASDAQ/S&P500 Change ratio maxed out at 1.89
DJIA -.03 percent
NASDAQ -.54 percent
S&P500 -.19 percent