In building upon the article “SPX/VIX Forecast Update” published on April 21st, the data below should help shed light on the next expected period of defensive positioning by Wall Street institutions.
The ratio of the Dow Jones Transports to the Dow Jones Utilities indices is another way of gauging Wall Street’s risk appetite.
When the black line is rising, Transports are outperforming Utilities. This is a classic sign that Wall Street is moving funds toward economically sensitive areas of the market. When the black line is falling, Wall Street is taking a more defensive stance – either rotating into Utility stocks or reducing exposure across transportation-related equities, including retail and consumer discretionary.
Defensive Positioning Forecast (Members Must Be Logged In)
Free QQQ Timing Guide: