Long Term, the S&P Has Followed Nikkei’s Bearish Declines

Looking back over the past 12 months, the S&P 500 has done well, up 19%, but the Nikkei did a little bit better, up 41%. When it comes to relative performance, the Nikkei is the clear winner; up 100% more than the S&P.

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Twice since 2000, the Nikkei index has formed rising wedges, broke support and fell hard. Each time this took place, the S&P 500 soon followed the Nikkei's lead. Some would say the Nikkei is the canary in the coal mine.

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Joe Friday: "The Nikkei has formed a bearish rising wedge (suggest lower prices 65% of the time) at a resistance line where other wedges have broken down and the S&P 500 followed."
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