We have had deep SPI discounts for a while as shown and that is...

We have had deep SPI discounts for a while as shown and that is usually good fodder for a rising market.

I have interpreted it as too much pessimism BUT perhaps it is just protection on the down side. Whatever, it has been useful for ever.

It looks like we get another red SPI candle today making it 9 out of the past 10 days. I haven't got today's data in there yet.

Now that's fine in a declining market but in a rising one it spells danger.

The blue line is 20 period C-L while yellow is just 10 period up-down closes. Seperation like now usually suggests sideways or reversal.

Anyway, to get a similar setup with discounts and red bars in a rising market it takes some looking.

They seem as rare as hen's teeth and only one that comes close is back in '94 which saw a sharp 2/3 week decline from here!

I guess at least some caution warranted.