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We've been following this one for awhile, and it continues to look interesting. The ratio of the Consumer Discretionary Select SPDR (NYSEARCA:XLY) to the Consumer Staples Select SPDR (NYSEARCA:XLP) is a good gauge of risk appetite.

For several days it appeared to be rolling over severely -- even as the broader market remained basically flat -- though on Thursday and Friday the ratio bottomed. A return of the uptrend would obviously be positive for the bulls. All that being said, it's going to be quiet trading this week, and next, in all likelihood.

chart

click to enlarge

Source: Chart: Ratio of Consumer Discretionary to Consumer Staples a Good Gauge of Risk Appetite