Thursday, August 28, 2008
the chart tells the story -- this obviously isn't 100% reliable, and even if it is signaling a downturn it could still be quite a ways off. but the indication would seem to be that the profile has shifted from reward to risk.
note too that the 50-day average of the ISEE is not particularly low on an absolute level as it was in april of this year. the result is that the most recent ratio spike was achieved on a slightly lower absolute level of the 5-day. the last time the ratio on an absolute level was this high (138.2) was in december 2007; april got as high as 136.2.