Historically, THE DOW and SEMICONDUCTORS and SMALL CAPS have been known as “leaders”.
Circles here just describe if they are currently above or below their bb centerlines 20ma
Eventually, when the markets mean-revert, will these leaders lead down?
Just for fun, let’s see who signaled down first at the BIG TOP in October 2007
NO I am not suggesting a crash, quite the contrary, this is just a very selective study of the so-called “leaders” at a key time
As far as I can see, by the time the big top hit in October 2007, the following were already signaling DOWN,
all via negative divergences: XLF, $RUT, $SOX and maybe $TRAN
The dow $INDU and the nasdaq $COMPQ both made new highs
To repeat: the dow $INDU, the so-called “leader”, DID NOT LEAD DOWN, big mistake
Anyway, “this time will probably be different.”