I love to use the Consumer Discretionary vs Consumer Staples ratio as a way of gauging offense vs defense in the equity markets.
The top panel shows the ratio of the XLY (Consumer Discretionary Sector SPDR) versus the XLP (Consumer Staples). The ratio is relatively flat with Consumer Discretionary (travel, hotel, retail) and Consumer Staples (beverages, personal products) essentially in line. They were moving in a similar pattern in the 4th quarter of last year, and slightly accelerated into the market high in February.
You can read more over at seeitmarket.com.
RR#6,
Dave
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