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Breadth
is Still Bad
Subtle signs of improvement in a few of the short-term breadth metrics but overall, the level of participation in the market’s uptrend is lacking.
Fearful Sentiment with Stocks
Near Record Levels
Despite lingering concerns about the Delta variant, the S&P 500 Hotels, Restaurants, and Leisure Index made a new closing high yesterday.
A Big Week for Technology
and Communication Services
Two of the key leading groups, Technology and Communication Services, will be in sharp focus this week as key members of each report earnings this week.
Who Charted? (E6)
It’s a US Large Cap Story
From Research by Potomac and the Conquer Risk podcast, hosted by Manish Khatta and Dan Russo, CMT.
New Equity Highs but Leadership
Remains Concentrated in Large Caps
The dips continue to be bought in the equity market, but outperformance continues to concentrate in the larger stocks, especially those with a “growth” bias.
Credit May Provide
the Best Roadmap
Under the surface, there remains a lot of uncertainty as it relates to thematic leadership. Credit may be the best “tell” in the near-term.
Breadth is Weak,
but We All Know That
Breadth metrics remain under pressure across markets, with Small Caps sustaining the most damage into Monday’s lows.
The Dips Continue
to be Bought
Equities are bouncing from support levels after a brief (thus far) pullback, as the 50-day moving average continues to define the trend for the S&P 500.
Support Levels
are Being Tested
Pharma appears to be making the turn vs. the S&P 500. As the prospects for a “risk-off” market continue, odds favor Pharma outperforming.
Beyond the S&P 500,
Markets Have a Risk-Off Tone
Treasuries and the Dollar, traditionally haven assets, have an underlying bid to them while Small Cap stocks remain under pressure.
This Indecision’s
Bugging Me
While the S&P 500 trades near-record levels, held aloft by the biggest of the Mega Cap stocks, under the surface there is a lot of choppiness.
Breadth Metrics Weaken
Across the Equity Market
Breadth metrics across markets have weakened further over the course of the past week, with the damage most pronounced in Small Caps.
More Fear Than Greed
but Stocks Trade to Record Highs
Record highs for the S&P 500 and NASDAQ 100 indexes point to keeping the bull market for equites intact. Sentiment remains in a fear position.
Who Charted? (E5)
The Market vs. Internals
From Research by Potomac and the Conquer Risk podcast, hosted by Manish Khatta and Dan Russo, CMT.
Banks Kick Off Earnings Season
with Cyclicals Under Pressure
Not much has changed at the sector level over the past week. Growth themes continue to benefit from rotation while the cyclical groups are under pressure.
U.S. Over the World
and Large Over Small
U.S. equities remain the best game in town but leadership within the U.S. market appears to be tilting back to the NASDAQ as Small Caps have begun to stall out.
Value to Growth Shift
Continues to Play Out
Commodity themes point to slowing global growth which is further supporting the outperformance of Growth stocks relative to Value stocks.
A Divergence Doesn’t Matter
Until It Does
While we are seeing some small divergences across different data points, the trend needs more time to play out.
Sentiment Becomes More Fearful
with Stocks at Record Levels
The S&P 500 and the NASDAQ have traded to record levels, but it is hard to make the case that sentiment is a concern.
Leadership Shifts as the S&P 500
Closes at a Weekly High
As the S&P 500 trades at record levels, groups such as Technology and Communication Services are taking the lead from the cyclical sectors.
The Return of Growth
Over Value?
The Growth/Value ratio for the S&P 500 remains above the 200-day moving average after crossing it last week.
Record Highs
but Lack of Broad Breadth Confirmation
Across the major markets in the U.S., the Advance/Decline Line is near record levels but is not yet confirming the record levels of the index.
Record Highs but
Not Much Froth
The overall trend in the equity market remains to the upside with the S&P 500 and the NASDAQ trading at record level.
More Signs of Rotation
Under the Surface
Rotation is the near-term focus for investors as groups like Technology and Communication Services have exhibited relative strength of late.
Stocks Close at Record Levels,
Havens Retreat
Equity trends in the U.S. remain to the upside with the S&P 500 and NASDAQ logging record weekly closes. Global stocks confirm the uptrend.
Is it Risk-On
or Risk-Off?
Is Growth regaining leadership? The improvement in Growth over Value, while Lumber and Copper remain under pressure vs. Gold.
Breadth Metrics
are Not Confirming Price Strength
Despite the S&P 500 trading near record levels, there are signs that breadth is weakening under the surface.
Something for Everyone,
But We Defer to Price
The trends remain to the upside, while being mindful of the bearish arguments which would be confirmed with breaks of key support levels.
Will the Cyclicals Hold
Where They Must?
The cyclical areas of the S&P 500 are in the process of testing important absolute and/or relative support levels. Will they hold?
Who Charted? (E4)
Risk Off or Just a Pause?
From Research by Potomac and the Conquer Risk podcast, Manish Khatta and Dan Russo, CMT present…
Pressure on Reflation Assets
Causes Key Levels to be Tested
The NASDAQ is a bright spot with reflation assets under pressure. Is the pressure likely to persist, or is this a pause?
Risk-Off or
Just a Pause?
While Treasury yields have moved lower over the past few weeks, the credit market is not sending a warning signal just yet.
Breadth Metrics Fail
to Confirm Price Highs
Despite the S&P 500 trading near record levels, there are signs that breadth is weakening under the surface.
Treasuries and Gold at Key Support
Ahead of the Fed
Later today, we will hear from the Fed Chairman, Jerome Powell, after the FOMC wraps up their policy meeting. All eyes will be on treasuries.
“Reflation” Trade
Under Pressure
Materials, Financials, and Industrials are all testing their 50-day moving averages from above. Relative trends are under near-term pressure.
Record Highs for Equities
as Long-Term Yields Break Down
Equity markets in the U.S. and globally are trading at/near record levels, while yields break down at the long end of the curve.
Are Investors Pricing
Slower Global Growth?
Commodity-Based Themes continue to weaken point to the possibility that investors are preparing for a slower growth environment.
Transitory or not?
Inflation on the Front Burner Today
All eyes on inflation today, with the release of the CPI report. Ahead of the report, investor expectations…
Small Caps Trade to New Highs,
Is the S&P 500 Next?
The S&P 600 traded to a new high this week, Sentiment is not greedy. Will the S&P 500 break to new highs as well?
Who Charted? (E3)
Most Stocks are in Uptrends
From Research by Potomac and the Conquer Risk podcast, Manish Khatta and Dan Russo, CMT present…
Signs of Life
in the Technology Sector
REITs Complete the Bearish to Bullish Trend Reversal while Technology Closes at a One-Month Relative High. Software Holds Relative Support.
Global Stocks and Commodities
Break Out
Equity trends remain to the upside in the U.S., and the Global Dow closed last week at a new high. Will the Relative Trend Turn?
Energy Powers
Small Cap Leadership
Value over Growth remains a key trend while two key breakouts emerge for Small Cap Energy. New highs for High Beta vs Low Volatility, will they hold?
A “Healthy Majority” of Stocks
are in Uptrends
Energy Equipment & Services are an Emerging Leader. Breadth Metrics Improve Across the NYSE, S&P 500, and S&P 600.
A Breakout for Crude Oil
is Bullish for the Energy Sector
S&P 500 and S&P 600 Push Toward Record Highs while Crude Oil has broken above key resistance, a potential positive for the Energy sector.
Offense Over Defense as Semiconductors
Close at a One-Month Relative High
The reflation/cyclical sectors of the market continue to receive the benefit of the doubt, as relative trends remain to the upside.
Maybe it was
Just a Pause?
Growth is likely to continue to lag Value. At the same time, Small Caps appear likely to reassert leadership over Large Caps.
Research by Potomac:
Your All-Access Pass to Leading Financial Insight
Research by Potomac is a lot of things, but if we had to sum it up it could best be described as your all-access pass, your front row seat.
Looking for Short-Term
Breadth Metrics to Improve
The NYSE Advancing – Declining Volume Line is in the process of breaking to a new high, ahead of the S&P 500.
Choppy,
With a Chance of Volatility
Equity markets in the U.S. are searching for direction, as near-term trading remains choppy within the context of longer-term bullish trends.
Who Charted? (E2)
Technology is Not the Stock Market
From Research by Potomac and the Conquer Risk podcast, Manish Khatta and Dan Russo, CMT present…
Broad Weakness
in the Consumer Discretionary Sector
The relative trends continue to favor the cyclical sectors of the market. Weakness in Consumer Discretionary is Broad
Like the NASDAQ,
Small Caps Give Up Their 10-Week Moving Average
Small Caps and the NASDAQ Closed Below the 10-Week Moving Average while Commodities have pulled back…
Is it Time for the Rest of the
World to Shine?
Watching the Shift Toward Global Stocks over U.S. Stocks. Copper/Gold Ratio Fails at Resistance while Lumber…
When it Comes to Breadth,
Your Time Frame Matters
Short-term metrics remain under pressure, while long-term metrics are healthy. Intermediate-Term Breadth is Neutral.
Less Aggressive
is Still Prudent
Global Stocks are on the Verge of a Relative Breakout and Sentiment is Tilting Toward Fear. Momentum Shifting…
One Eye on “Reflation” Sectors,
One Eye on Defensive Sectors
Materials, Energy, Financials, and Industrials Sectors continue to lead the pack while Defensive Sectors are…
Rates Fail to Respond
to Rising Inflation
U.S. Equities Test their 10-Week Moving Averages while Rates Fail to Move Higher on the “Worrisome…”
Longer Trends
Favor Risk-On Over Risk-Off
Equity Themes turn slightly Risk-Off but remain above Support while Intermarket Themes (Commodities) are…
Breadth Metrics are Bent, Not Broken,
as Equities Pull Back
Breadth Weakens as Equities Pullback, Short-Term Metrics Not Yet at Washed Out Levels while Long-Term…
Gold Stocks Glitter Despite
a Pause for Broader Equity Averages
Small Caps are Breaking their Relative Uptrend, while the NASDAQ Completes a Topping Process vs. the S&P 500.
Technology’s Weakness
Extends Beyond the Largest Stocks
Technology Completes its Relative Topping Pattern While Weakness Extends Beyond the Largest Names…
US Stocks, Global Stocks & Commodities…
Up and Out!
The relative underperformance of the NASDAQ is on the verge of turning decidedly bearish while Small Caps…
Who Charted? (E1)
Commodities and Transports
From Research by Potomac and the Conquer Risk podcast, Manish Khatta and Dan Russo, CMT present…
Risk Seeking
over Risk Aversion
The ratios of Copper to Gold and Lumber to Gold provide an intermarket confirmation of the higher risk appetite…
Financials are More than Banks;
Insurance is Making a Relative Turn
Breadth metrics for the S&P 500, NYSE and S&P 600 have weakened slightly in the near-term but remain…
Short Circuit:
Semiconductors Break Down
A relative breakdown for Semiconductors, along with a shift in momentum, will likely be a headwind for the NASDAQ…
Leadership
Begins to Emerge
Materials and Financials remain in an absolute uptrend, while Technology and Discretionary continue to fade on a…
The Pauses
that Refresh?
Equities, in the U.S. and abroad, remain in consolidation mode. The S&P 500 has made no progress…
Copper vs Gold:
A Breakout Would be a Big Deal
The copper/gold ratio is arguably one of the most important relationships to watch in the market right now.
Breadth is Not the
Place to Start a Bear Case
Breadth metrics continue to support the bullish trend in equities as participation remains broad. Leadership may…
A Big Breakout
in a Key Industry
The S&P 500 Air Freight & Logistics Index gapped to a new high with a momentum confirmation. Sentiment is…
Research by Potomac
(S4 E17)
Where can you find institutional quality investment research for financial advisors? How is Potomac elevating…
Still Searching
For Clear Leadership
Absolute trends are fairly clear, most are up and to the right, confirming the bullish trend for the broader equity market.
Equity Weakness
Was Bought
Equities stalled just below record highs last week. Looking at the performance numbers on the week doesn’t paint…
Shifts Between
Risk-On and Risk-Off
From a risk-on/risk-off perspective, the trends are showing signs of a subtle shift toward risk-off taking place.
Is Gold Regaining
its Shine?
The S&P 500 Gold Index is attempting to reverse trend on an absolute basis while breadth metrics remain constructive.
S&P 500 Rests
After a Record Run
Equities in the U.S. are taking a break to start the week. Small caps and the Nasdaq remain in consolidations.
Absolute Highs
but a Relative Mess
Another record high week for the S&P 500 and Nasdaq 100 while the US dollar continues to fade below resistance.
New High
for the Nasdaq 100
Another record high week for the S&P 500 and Nasdaq 100 while the US dollar continues to fade below resistance.
Does Copper Have the
Answer to the Leadership Question?
Trends continue to point to a willingness on the part of investors to take on risk, but what will lead?
Can Breadth Be
Too Strong?
Breadth metrics for the S&P 500 and the NYSE remain healthy. For the S&P 500, trend measures have…
S&P 500 Reaches
Overbought Levels
Under the surface, there is a potential shift in leadership as small caps are breaking relative support.
Looking for Clear
Sector Leadership
Equities started the week by not doing much of anything, with the three major averages trading mostly flat…
Is Large Cap Growth
On the Comeback Trail?
U.S. equities remain in an uptrend from the March 2020 lows. Small caps continue to consolidate…a pause that refreshes?
Risk on!
But Where Will the Leadership Be?
With the S&P 500 trading at record levels, we look at some of the important relationships that can give us a sense…
Strong Breadth
at Record Highs
Breadth metrics in the equity market remains supportive of the bullish price trend in the near term for the…
Europe: On the
Brink of a Breakout
Much of the weakness in the “growth stocks” and the Technology Sector since the middle of February…
All Eyes on the
Technology Sector
Much of the weakness in the “growth stocks” and the Technology Sector since the middle of February…
The Uptrend
Continues
The uptrend from the March lows remains in place for risk assets with the S&P 500 trading to a new record weekly…
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