Relative strength of the S&P 500 back on top of money market and bonds. Déjà-vu?

Earlier this year, at the end of August, the relative strength of the S&P 500 dropped below both the money market and the US taxable bond market for the first time since August 22nd, 2011. By October 7th, 2015 it climbed above the money market.  Finally, last week, it regained the top spot over the US taxable bond market as well.

From August 2011 to October 2011 we saw a very similar two month pattern. On August 22, 2011, the S&P 500 fell below both the money market and the US taxable bond market on a relative strength basis. By October 12th of that same year, it regained the lead over the money market and by October 20th, 2011, it regained the top spot over the US taxable bond market well.  Give or take a couple days – a two month bump in the road for the S&P 500 back in 2011 looks just like the one in 2015.

After the 2011 blip, the S&P 500 faired pretty well. In the words of the late, great Yogi Berra we certainly hope “it’s like deja-vu all over again.”