Monday’s (9/15) close marked the ninth and sixth consecutive days that the Nasdaq-100 (NDX) and Nasdaq Composite (NASD) were positive. Intraday action saw both indices climb to new all-time chart highs with NDX rallying to 24200 and NASD rallying to 22200. This stretch of positive action for both indices is rare territory as NASD has had a streak of 6 positive trading days in 3.7% of all trading since 1972. Meanwhile, NDX’s streak of 9 positive trading days has occurred just 0.55% of all trading days since 1992. For reference, NASD and NDX have been positive 55% and 54% of all trading days historically, and the longest stretch of positive trading days for NDX and NASD reside at 14 (July 2013) and 19 (August 1979) days, respectively.

NASD has seen three other six day stretches of positive action in 2025 with the Index rally 4.96% on average, so this recent rally of 2.99% (9/5/25 – 9/15/25) is muted comparatively. But while there have been other six day stretches of positive action for NASD, investors have not witnessed a seven-day streak since August 2024.

For NDX, it has been since late 2023 when investors last saw the Index go on such a stretch of positive days. Back then, NDX rallied 8.5% over the nine-day period (10/26/2023 – 11/8/2023), which is roughly 4% higher than the current rally for the index (4.57% from 9/2/2025 – 9/15/2025). While intraday action Wednesday has NDX hovering between positive and negative, a positive close would mark a 10^th consecutive day for the first time since late 2021.

While both indices have rallied to new highs, action within certain indicators for the NASD (OTC) and NDX universes present differing pictures under the hood.

While the BP for NDX (^BPNDX) resides in Xs at 54%, this is below levels north of 70% witnessed during the summer months, suggesting that less stocks are helping push the index to its recent highs. Meanwhile, the BP for the Nasdaq Composite (OTC universe) (^BPOTC) moved to its highest level in just shy of four years back in July. The OTC BP did reverse into Os on the chart during August’s trading but saw its value return to near its July high mark with recent action. With a comparative decrease in participation in NDX, while NASD has seen a continued increase as of late it is an indication of broadened participation outside of the largest names. Said differently, recent positive action for the indices has been helped by smaller cap stocks rallying and improving their technical pictures.

Confirmation of this can also be seen on the RS in Xs indicators for NASD (OTC) (^RSXOTC) and NDX (^RSXNDX), which measures the percent of stocks maintaining positive near-term market relative strength (RS). While both charts reversed into Os in August, the RSXOTC has increased in reading and resides within one box of reversing back into Xs. The potential reversal into Xs would match the charts’ two-year high mark and would suggest more than half of the stocks within NASD maintain positive near-term market RS. After reversing down in Os in August the RS in Xs indicator for NDX has continued lower to 42%, matching its February 2025 low mark. The long-short of the story here is like the above, as NASD has witnessed an increase in stocks showing positive near-term relative strength, while NDX has seen a decrease.

While long-term relative strength still favors the large to mega cap names within the indices, near-term trend and relative strength have improved for smaller cap names. This is noteworthy for momentum-based strategies as the ability to differentiate from the largest names within the indices can offer opportunity for outperformance.

The 60/40 equity/bond portfolio has been proclaimed “dead” over the last few years. Really, it’s been the 40 that’s been dead as bonds just saw their three-year rolling return turn positive for the first time in three years. On the other hand, equities have been the only game in town putting in back-to-back 20% annual returns which has kept the overall 60/40 idea afloat since a horrendous 2022. Incredibly, going back to 2019, the SPX has gained at least 20% in a calendar year four times in six completed years. The last time we saw this level of consistent equity returns was the mid-1990s, which was followed by a less than stellar early 2000s. This isn’t a call for a repeat, but a note that it’s rare for equities to do this well over a six-year period. Despite a poor equity market in the early 2000s, bonds did exceptionally well, as AGG put together positive annual performances from 2000 until 2004. The reason 2022 was so bad for the traditional asset allocation portfolio was the magnitude of AGG’s negative performance. AGG was down nearly 15% in 2022. Other than 2022, AGG’s worst annual performance on a price return basis was -4.19% in 2013. Outside of 2022, the 60/40 portfolio has been in-line with expectations over the last few years.

To visualize the relationship between equities, bonds, and the 60/40 portfolio, the graph below shows the rolling three-year cumulative returns for each asset on a price return basis. It might not be noticeable on the graph, but AGG’s three-year return just turned positive for the first time since early 2022. A lot of that has to do with the 2022 data rolling off the three-year calculation, but this was the longest period of rolling three-year negative performance in our dataset. Moving on to equities, SPX has a three-year rolling cumulative return north of 60%, which is strong when compared to the last 25 years but pales in comparison to the mid-to-late 1990s. Lastly, the 60/40 portfolio is nearing a three-year cumulative return of 40% which was only eclipsed in the periods following the GFC and Covid crashes since 2000. The mid-to-late 1990s were a boon for both equities and bonds as the rolling three-year return for the 60/40 portfolio routinely sat between 40-60%. To put that in perspective, that’s like owning equities and bonds since roughly the time of the 2022 bottom and then having the next few years produce even better returns.

Overall, the “asset-allocation” portfolio is closing in on “rich” levels historically, but it does have precedent to continue to push further to the upside. However, if we see the 60/40 up more than 50% in a three-year period soon, it may be a good time to be cautious. From an equities perspective, the picture already looks “rich”, but they can certainly continue higher. Nonetheless, this is a great talking point with clients, especially those near/at retirement that want to be aggressive with the expectation that the market will continue to do what it’s done in the last three years. For clients at this stage of life, it’s worth having another conversation about goals/risk with the framing that the market has done very well in the last few years, but let’s not forget about our financial milestones. Achieving those goals and milestones may be more so on the capital preservation side than the growth side given the strong returns over the last few years. This is likely a busy time for client meetings as the summer has ended and the holidays are still a couple of months away, so it’s a great time to remind clients of their financial goals and what is needed to achieve them.

Daily Option Ideas for September 16, 2025