One of the most telling and obvious risk-on indicators would be the Nifty Small Cap 100 index. Why is that so?
Because when you look at a market rally, the longevity of that particular rally can be gauged by market participation. This is something that should be viewed closely. If a particular index is making new highs, how many stocks are contributing to that move?
Is it a handful? Is it a majority of the stocks? These are data points that will hint at the inherent sentiment of the move.
So let’s take a look at what the Small Cap-100 new highs are telling us. [Read more…]