Tag Archives: correlation

Ominous Correlation

The 60-day correlation between SPY and QQQ ETFs has plunged near pre-dotcom crash and below pre-2007 top levels. Caveat lector included.

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Low S&P 500/Nasdaq-100 Correlation Positive For the Market

The 60-day correlation between S&P 500 and Nasdaq-100 has dropped to levels reached along the 2000s uptrend. Although correlation can be dubious measure, current low levels may indicate that there is potential in the market for further gains.

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Why The Stock Market Was Down Yesterday

So why did the stock market go down yesterday? Was that because of the overbought signal from the McClellan indicator or because of the resistance from the 50-day moving average? Or was it due to falling crude oil prices? Can … Continue reading

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Correlation Between Stocks and Oil is a Chart Illusion

Two markets that are both in down trends are not necessarily highly correlated. For example, although the stock and oil markets are both in a downtrend, their actual correlation is not that high. Actually, the much talked correlation is a … Continue reading

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Whether Bonds and Stocks are Correlated Depends on the Timeframe

In the short-term stocks and bonds have again turned anti-correlated after a period of positive correlation, in the medium-term they show no correlation and in the longer-term they are anti-correlated.  Correlation depends on timeframe.

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Bonds – Small Caps Anti-correlation and Chart Illusions

The correlation between TLT and IWM was neutral in the beginning of this year but then the two started to anti-correlate as investors sold small caps and moved into bond funds. The tendency is for the anti-correlation to increase.

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