A short but extremely difficult week has passed. The sentiment indicators seem to have taken a liking to drift apart. Last week the market psychology was led to new extremes. It seems that market participants have lost their awareness of the market’s risks and fair valuations. Since the beginning of the month, the VIX index has been above the long-term average of nine points (50%). The difference between the S&P Value Index and the S&P Groth Index has seldom been as large as in the past weeks.
In this environment, the S&P 500 lost about 0.9%. ONE SIGNAL provided only long signals but lost about twice as much due to the overnight movements. The only winner of the week was gold with 0.36%.