We may be nearing the end of the recent rotation in stocks, and here is why.
The New York Stock Exchange Advance Decline line (NYAD) has made a new high, just as the implied volatility (IV) of the S&P 500 (SPX) complex index, SPY ETF, and related futures and options has crashed. Moreover, the decline in IV volatility is occurring at the same time we see a narrowing of the Bollinger Bands which, on its own, suggests that a big move in stocks is approaching. Of course, the direction is always difficult…

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