Today’s chart is a weekly look at the ratio between the price of 10-year Treasury’s and the S&P 500. When the ratio is falling, it indicates the S&P is outperforming Treasury’s, and vise versa when it is rising.
On a weekly basis, it seems when the ratio drops below 0.095 we hit a turning point in the market. Now it’s important to note here that this ratio is not a trigger to buy and sell equities or bonds (plus I don’t make those kinds of recommendations on this site), but to take the temperature of the two markets as they battle out performance and tend to revert back to a mean.
I’ve circled the past instances of the ratio hitting low levels. I’ve included the drop in 2010, although it doesn’t get to 0.095, it gets pretty close.
That’s all I have for today. Have a great weekend.
Disclaimer: Do not construe anything written in this post or this blog in its entirety as a recommendation, research, or an offer to buy or sell any securities. Everything in this post is meant for educational and entertainment purposes only. I or my affiliates may hold positions in securities mentioned in the blog. Please see my Disclosure page for full disclaimer. Connect with Andrew on Google+.