Software Is Ruining Everything

JC Parets
May 30, 2024

Software is supposed to be one of the leaders of the Nasdaq.

But this time around, it's one of the groups trying to drag it down.

Look at the new highs this year in the Nasdaq, but Software continuing to put in a series of lower highs, and possibly its first lower low this week.

What's happening in Software right now reminds me a lot of the divergence we've been seeing between the Dow Jones Industrial Average and Dow Jones Transportation Average.

Higher highs in the Dow Industrials, but lower highs and fresh 6-month lows in the Dow Transports.

These divergences really stand out and call into question the direction of the main trends for the more popular indexes, the Dow Industrials and Nasdaq100 in these cases.

The weakness underneath is hard to ignore.

Want to see something hilarious?

Here are the returns since they decided to kick Exxon Mobil out of the Dow Jones Industrial Average, where it had been for over 90 years, to replace them with Salesforce back in August of 2020:

And these returns are before the CRM selloff after their May 29th earnings report.

If you recall, Crude Oil traded below zero back in 2020, and then they kicked Exxon out of the Dow. Energy has been the standout winner ever since.

There's a lot happening in this market right now.

I think there are so many opportunities from the long side, and we're also finding opportunities from the short side.

On Monday night we'll be going over exactly how we find these trades and which ones we're putting on.

Premium Members can REGISTER HERE for Monday night's LIVE Monthly Charts Strategy Session.

We'll get going LIVE @ 6PM ET Monday June 3rd and if you can't be there live, the video and slides will be archived so you can watch any time.

If you're not already a Premium Member and would like to attend on Monday, you can sign up here RISK FREE so you can join us for the LIVE call and access all the trade ideas and alerts.

See you there!

JC

 

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