CPCI to CPCE ratio has been climbing with the current rally in the markets since March. Currently it is signaling an impending correction that should start any day now, note similarities in the pattern with the correction experienced in June. Assuming that the correction starts, it will probably be stopped by the lower blue trend line. The drop to get to that trend line looks larger in this case than it did in June, indicating a larger percentage drop in SPX as well. My estimation is that about a 12%-15% correction in SPX will bring the ratio to the lower trend line.
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