Nasdaq to S&P 500 Index Ratio Undergoing Important Test!

nasdaq to s&p 500 index price ratio chart trend support analysis

Tech stocks have been on shaking ground over the past several weeks / few months.

And this shows up clearly in today’s ratio chart, pitting the Nasdaq Composite versus the S&P 500 Index on a “monthly” basis.

This long-term chart really gets at the heart of the Nasdaq’s performance versus the broader market… and because it’s a “monthly” chart, it really highlights the macro trend.

As you can see, the Nasdaq’s out-performance propelled it to touch its 2000 highs before pulling back. The recent underperformance has seen the Nasdaq slide to a key trend-line support area.

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Bulls want this area to hold and spur another rally attempt higher. But if this price support breaks down, then look for tech stocks to under-perform as the ratio heads to the lower end of its up-trend channel. Stay tuned!

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