Intermarket

US Dollar ($USD) has been mostly rising since early February 2018 (Chart 1) after making a low of 88.15. On relative basis, the Dollar Index is out-performing Reuters/Jefferies CRB Index (Chart 2).

U.S. Treasury Bonds ($USB) have been mostly declining since June 2017 from a high of 176.06 but since October 2018, they have been staging a rally, after reaching a low of 136.40 and on relative basis, $USB is out-performing the Dollar Index.

Commodities Index (Reuters/Jefferies CRB Index – $CRB) have been moving mostly sideways since April 2017 after making a low of 154.85 in January 2017. $CRB is also mostly underperforming other asset classes for many months. S&P 500 ($SPX) have been rising since December-end 2018 and the equities are mostly out-performing other asset classes.

The current relative strength sequence is S&P 500 followed by Bonds, U.S Dollar and Commodities.

Major U.S. Indices

Major U.S. indices have been rising since early 2009 with few retracements and sideways move (Chart 3). The last rally started in early 2016, the indices pulled back once in early 2018 and then in late 2018. The indices have been rising since the last week of December 2018.

S&P 500 ($SPX) underperformed Dow Jones Industrial Average ($INDU) from June to November 2018 and since then both are showing same relative strength. S&P 500 is slightly underperforming NASDAQ Composite ($COMPQ)  and under performing Russell 200 ($RUT) and Dow Jones Transportation Average ($TRAN) since November 2018 (see Chart 4).

Since the start of 2019, DJIA are either equaling or underperforming NASDAQ Composite. But it is decidedly underperforming the small caps, Russell 200 and Transports.

NASDAQ Composite is also underperforming the small caps. The Russell 200 is out-performing Transports (see Chart 5).

At the moment, Russell 2000 is showing the most strength amongst the major U.S. indices. It is following for Dow Jones Transportation Average and NASDAQ Composite. The large caps, S&P 500 and Dow Jones Industrial Average are performing equally well as all are rising since the beginning of 2019.