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For the most part General Electric (GE) and the S&P 500 Depository Receipts (AMEX: SPY) exhibit very similar patterns during the past year or so. However, upon a closer look, we notice that GE actually peaks slightly before the peak in the SPY. After the March rally, GE peaked on May 8, while the SPY peak on June 11. After the July pivot low, GE peak on Aug 7, while the SPY peaked on Aug 25. And last Thursday, Sep 17, both GE and SPY hit new post-March recovery highs. If GE now begins to diverge negatively with a still-buoyant SPY, then perhaps we should expect the SPY to roll over in a significant way at the end of the month (as GE builds a top)? Let’s watch this relationship closely in the days ahead.
Mike Paulenoff is author of www.MPTrader.com, a real-time diary of his technical analysis & trade alerts on ETFs for precious metals, energy, currencies, and an array of equity indices and sectors, including international markets, plus key ETF component stocks in sectors like technology, mining, and banking. Sign up for a Free 15-day Trial!
