According to SentimenTrader.com, the equal weight index took 23 trading days to go from a record high to at least a 5% pullback and back to a higher high. Dating back to 1957, SentimenTrader.com analysts said in a note on Monday, this was the fifth quickest recovery, bettered only by three in late 1982 and early 1983 and one in 2014. Notably, each was a positive signal, and the equal weighted index was higher one, two, three, six, and 12 months later in each case.
"Regardless of what the much more popular capitalization-weighted index was doing then, these quick recoveries in the equally-weighted index tended to precede outperformance for the equal-weight version," the note said.
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