The last time SPX made a new high (1850.84 on Jan 15) it promptly dropped 113 points (6.1%.) Is there reason to believe the new highs will stick this time?
Let’s start with the carry trade on USDJPY — which has retraced barely 38% of its drop from its EOY highs. Remember, 105.43 represented a .618 retrace of the 2007-2012 plunge and the .618 retrace of the 1996-1998 gains and a TL from the 1998, 2002 and 2007 highs. This was a very significant top.
Likewise, the 10-year note stalled at the .382, a serious decoupling vs the SPX.
Speaking of decoupling, how about the DJIA and SPX? The Dow, which is approaching a .786 retrace of its EOY highs at 16,315 and the Butterfly Pattern target of 16,300, is well off the pace set by SPX.