No doubt those traders in dividend-paying stocks were the huge winners last year and made the correct call. DVY and SDY are two divvy ETF's that serve as a proxy. Both charts exhibit the same pattern. The DVY weekly chart red arrows show the negative divergence spank downs that were described as they occurred over the last year and one-half. The SDY daily chart shows the more recent negative divergence spank downs. In both charts, price is making new highs but the indicators, for the most part, are negatively diverged. This indicates topping action but with such high momo over the last year there is time required to move flat then roll over. The projection is that the dividend bubble should pop in the weeks ahead, with price moving lower off the top, then recovering mid-year to place a right shoulder for an H&S pattern, then roll over into the end of the year. Both charts show rising wedge behavior with overbot stochastics. The RSI's may want to venture higher into the overbot territory which may provide the final topping behavior ahead.
As folks seek yield for the last couple years, the dividend stocks are jam-packed full of dough. If the move off the top occurs, the move out of divvy's may become dramatic, a stampede as gains are locked in, however, as the exodus occurs in full force, poor ole bag holders Grandma Edna and Grandpa George, always the last to the game, are going to be run over, walkers and all. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
I love the way you put every day live into stock charts, because the sad thing is that's exactly the way it will go. and since grandma and grandpa can't walk so fast, they were late to the party and last to exit... sad, very sad.
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