Sep
14

BKX SOX Divergence

By on Tuesday, September 14th, 2010 at 2:31 pm

Interesting divergence taking shape as semiconductors and financials are moving in opposite directions. Currently the SOX is up over 1% on the day while the BKX is down more than 1%. Looking back at instances when a similar divergence initially occurred, it seems semiconductors usually win the battle for control over the short-term…

SOX +1%, BKX -1%
12/03/09… S&P500 +0.6% next session
07/17/09… S&P500 +1.1% next session
05/27/09… S&P500 +1.5% next session
05/19/09… S&P500 -0.5% next session
04/30/09… S&P500 +0.5% next session
04/22/09… S&P500 +1.0% next session
04/08/09… S&P500 +3.8% next session
03/13/09… S&P500 -0.4% next session
03/03/09… S&P500 +2.4% next session
02/12/09… S&P500 -1.0% next session
01/15/09… S&P500 +0.8% next session
12/09/08… S&P500 +1.2% next session
09/24/08… S&P500 +2.0% next session
08/07/08… S&P500 +2.4% next session
07/15/08… S&P500 +2.5% next session
06/04/08… S&P500 +2.0% next session
05/30/08… S&P500 -1.1% next session
04/21/08… S&P500 -0.9% next session
04/09/08… S&P500 +0.5% next session
02/11/08… S&P500 +0.7% next session
01/18/08… S&P500 -1.1% next session
03/06/07… S&P500 -0.3% next session
06/14/06… S&P500 +2.1% next session
11/30/05… S&P500 +1.2% next session
10/19/04… S&P500 +0.0% next session
09/20/04… S&P500 +0.6% next session
05/07/04… S&P500 -1.1% next session
04/02/04… S&P500 +0.8% next session
08/01/03… S&P500 +0.3% next session
04/16/03… S&P500 +1.6% next session

Of the last 30 instances in which the SOX closed up 1%+ and the BKX closed down 1%+ (for the first time in at least two sessions), the S&P rallied the next day in 22 out of 30 occurrences, or 73% of the time vs. 54% at-any-time odds for a higher S&P one session later. The S&P never fell more than 1.1% the next day, while it rallied more than 1.1% eleven times.

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