Technical Analysis Update: New All-Time Highs Coming

The S&P 500 is now within 2% of its all-time highs. At this point, it’s a given that traders will make a run for that level sometime this week.

approaching

It’s worth noting that stocks have already made a new all-time high… and then some!

all time high secured

As far as trading goes, the bigger issue is if we’re finally about to see some rotation away from tech stock, which have been the big leaders, to other lagging sectors (financials, microcaps, etc.).

A Major Market Development

Rotation occurs when capital begins to move en masse from one sector to another. Typically, this involves money shifting from a sector that has been leading to one that has been lagging.

In our recent market climate, this means money shifting out of tech stocks and semiconductors and into things like cruise lines, theme parks, financials, and the like.

Last week, microcaps (in blue) outperformed tech stocks (in orange) by a significant margin. This has NOT been the case for most of the rally from the March lows.

outperformed

Astonishingly, even financials – one of the worst performing sectors since the March lows – OUTPERFORMED tech last week.

financials

Of course, one week does not make a trend, but this is a major development worth watching.

One of the best opportunities for trading is when laggards play “catch up.” And with tech stocks dramatically overbought, we might have the makings of some great gains here.

More to come this week.

Best Regards,

Graham Summers
Editor, Money & Crisis

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Graham Summers

Editor Graham Summers has spent the last 15 years building a reputation as one of the most sought after and highly respected investment strategists on the planet. His work has been read and quoted by former Presidential advisors, award-winning institutional analysts, U.S. Senators, and more. He’s one of the few analysts on the planet to...

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