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We’ve begun seeing a bit of sector rotation lately, with leading stocks and sectors cooling off and formerly lagging industries seeing a bit of buying interest. Institutional sector rotation is common in bull markets, and the rotation of funds from one industry to another enables broad-based uptrends to remain intact, even when certain sectors are […]

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Yesterday’s (October 8) selloff was broad-based and ugly, with just about every industry sector getting hit hard (utilities were an exception). The NASDAQ Composite ($COMP) and small-cap Russell 2000 Index ($RUT), the leading market averages in recent months, were hit the hardest with losses of -2.0% and -1.7% respectively. The NASDAQ is now the only […]

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Over the past few months, PowerShares Aerospace & Defense ($PPA) has shown great relative strength to the benchmark S&P 500 Index. On the daily chart below, notice that $PPA has broken out twice over the past few months, setting higher highs and higher lows along the way. During that same period, the S&P 500 SPDR […]

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Over the past several weeks, we’ve been discussing the increasing relative strength in small-cap stocks, compared to the rest of the broad market, and that bullish divergence continues to widen. Despite the blue-chip Dow Jones Industrial Average ($DJI) falling 0.8% and closing well below key support of its 50-day moving average yesterday (September 30), the […]

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