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NASDAQ-S&P 500 Ratio Undergoing Important Test

By Chris KimbleStock MarketsMay 14, 2021 11:10AM ET
www.investing.com/analysis/nasdaq-to-sp-500-ratio-undergoing-important-test-200580159
NASDAQ-S&P 500 Ratio Undergoing Important Test
By Chris Kimble   |  May 14, 2021 11:10AM ET
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NASDAQ Composite-S&P 500 Ratio Monthly Chart.
NASDAQ Composite-S&P 500 Ratio Monthly Chart.

Tech stocks have been on shaking ground over the past several weeks and few months.

And this shows up clearly in today’s ratio chart, pitting the NASDAQ Composite versus the S&P 500 Index on a “monthly” basis.

This long-term chart really gets at the heart of the NASDAQ’s performance versus the broader market. And because it’s a “monthly” chart, it really highlights the macro trend.

As you can see, the NASDAQ’s out-performance propelled it to touch its 2000 highs before pulling back. The recent underperformance has seen the NASDAQ slide to a key trend-line support area.

Bulls want this area to hold and spur another rally attempt higher. Until broken, this is a strong support level – and odds favor that it will hold.

But if this price support breaks down, then look for tech stocks to underperform as the ratio heads to the lower end of its up-trend channel. Stay tuned.

 

NASDAQ-S&P 500 Ratio Undergoing Important Test
 

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NASDAQ-S&P 500 Ratio Undergoing Important Test

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Comments (5)
Werner korze
Werner korze May 15, 2021 8:23PM ET
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it is perfect
Privacy Please
WTIHedge May 15, 2021 1:39PM ET
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I was looking at something similar and I agree its at or certainly will be at that critical support or resistancd depending on your chart make up or orientation. I have already taken the position that tech will hold relatively but we shall see. Direct consumer support will all but have disappered by late summer and Biden seems to be desperate for gop support so expecting him to back down on major business tax hike . The big money always seems to escape relatively unscathed. Consumer stock run coming to an end .
Michael Wry
Michael Wry May 15, 2021 12:05PM ET
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I don’t know what the odds are but it’s not gonna hold
Peyman Deniz
Peyman Deniz May 15, 2021 5:23AM ET
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Hei
Joyce Yun
Joyce Yun May 14, 2021 9:40PM ET
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what are the odds from your analysis
 
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