Well, that certainly moved the Volatility Index -- and gave us some volatility for the week.
And what of the breadth? Was it weak enough to move the needle? It was weak enough to get the McClellan Summation Index to halt its rise? In that respect, we are in the same place we were a week ago: A positive day of breadth will send it right back to the upside. But there are some differences this week vs. last week.
Last week, it took four of five weak breadth days before the Summation Index halted its rise: That spoke of underlying strength, more or less. This week, it took two days, which makes it easier to roll over. There are other changes, too.
The banks are weaker than they were a week ago, with the Bank Index having broken the uptrend line and now closing in on the low from mid-April (remember, the S&P 500 was around 2700 when the Bank Index was last at these levels).
While Monday saw an increase in new highs for Nasdaq, Tuesday saw a near tripling of stocks making new lows for Nasdaq. That is now the highest reading since early April. That, too, is a change we didn't have a week ago.
On the sentiment front, we had the Citi Panic/Euphoria Model tag Euphoria this past week, something that had not happened a week ago. We also saw the Equity put/call ratio get to 50% on Monday. That is the lowest reading since mid-February. And it is also just a smidgen away from having a reading in the 40s, which is the line in the sand where I say sentiment has gotten extreme.
A week ago the ratio of the Invesco Equal Weight S&P fund (RSP) to the Invesco QQQ trust (QQQ) was hovering at .42. It broke it by a fraction this week, but I'll say it's not as much as I thought it would be. It doesn't change that if it falls much more from here, this will look like a fresh breakdown.
I know I keep harping about the iShares Philadelphia Semiconductor Index, the SOX, but notice it made a lower high on last week's rally. It hasn't broken 1,700 yet, which is where this second uptrend line comes in (I still think it comes down to 1,600) but the lower high gives me more confidence it will break it.
Then there is the SOX relative to Nasdaq ratio, which hasn't made a higher high since December and has been making lower highs since early April. A lower low in this ratio and my call for 1600 on the SOX should work.
In any event, now we'll get to see how fast sentiment turns from complacent to concerned. We did not see it in the put/call ratios Tuesday, but it was the first day down.