📈 Where Are We Going From Here?

We have a few signs.

Market Direction

While we have been moving up in the market, we have seen a shift in where we are seeing leadership in the market (or lack thereof).

Here’s what we’re seeing.

The S&P 500 is Outperforming the Nasdaq

The chart below shows you the S&P 500 divided by the Nasdaq.

You can see that as of late we are starting to see weakness in this chart - in that over the last day or two the S&P 500 has outperformed the Nasdaq.

In a healthy market we have the Nasdaq as the leader (or the IWM). You need to be very cautious when the S&P 500 leads.

I am not saying we are heading for something like what we saw in 2022 but it is something to keep an eye on for short-term market strength.

Sectors

Another thing to keep an eye on is that we are seeing many sectors starting to break down.

We are still seeing strength in Bitcoin names and semiconductor names, but we saw weakness in others.

Sectors like biotech, communications, regional banks, and basic materials all had zero follow through yesterday after pump faking strong starts to the day.

I walk through my thoughts on the market in this clip: