From the desk of Steve Strazza @Sstrazza and Louis Sykes @haumicharts
At the beginning of each week, we publish performance tables for a variety of different asset classes and categories along with commentary on each.
Looking at the past helps put the future into context. In this post, we review the absolute and relative trends at play and preview some of the things we’re watching in order to profit in the weeks and months ahead.
The major indexes continue to hold important levels and many large-cap sectors have laid the foundation for upside resolutions and another leg higher in their relative leadership. 
SMIDs and Micro-Caps have had every chance to digest their recent gains, but we're yet to see that play out. Seeing such strong upward momentum from these stocks speaks to the healthy risk appetite we continue to point out.
FICC markets are also assigning stocks with a clean bill of health and supporting/confirming a continuance of their primary uptrends.
Let's jump right into this week's report with our US index table.
The leadership in this section is becoming more balanced as Large-Caps look ready for some short to intermediate-term leadership. This comes after SMIDs and Micro-Caps have made substantial gains in the past months/quarters.
While we still like names down the market-cap scale, the general risk vs reward is more favorable in Large-Caps at this point.
Many major indexes are holding on and consolidating just above their Q1 highs, which can only be seen as positive for markets. For any bearish thesis to start playing out, Large and Mega-Cap indexes failing here and closing below their Q1 highs would be a good start. For now, the weight of the evidence leans overwhelmingly in favor of these breakouts sticking.
So, here's the Dow Jones Industrial Average and the NYSE Composite - which has a larger-weighting in international names, both resolving above their critical Q1 highs.
Meanwhile Small-Caps $IWM have continued their relentless upside move.
Here are Russell 2000 futures relative to Nasdaq 100 futures, zoomed out about 30-years.
This ratio represents whether we want to be buying Small-Caps over Large-Cap Growth, or vice versa.
We covered this last week but want to touch on it again because the resolution of this short-term consolidation will set the stage moving into the first quarter of 2021... and it looks like we're going to get one soon.
Coming off the 2000 lows, the long-term outlook still favors SMIDs, but we expect some chop and digestion at this level where Growth can take the baton of leadership for the next few months, or even longer.
Overall, nothing too much has changed from this section in the last week.
The major indexes are still supporting what we're seeing under the hood with strong underlying internals.
So let's move now to our Sector ETF table.
Large-Cap Growth-oriented sectors are finally resolving higher.
These breakouts are adding substantial weight to the new highs we're seeing in Large-Cap indices, seeing as these sectors make up a hefty weighting.
Technology $XLK gapped up to all-time highs to kick off the week, finally cementing this nearly 4-month breakout.
The risk is so well defined and skewed in our favor, at both the individual stock and ETF level.
And when we look at the sectors on a relative basis, there's a clear standout on both an intermediate and short-term timeframe.
As XLK has outperformed heavily over the last few weeks, the cyclical sectors have lagged behind. From a pure asset allocation perspective, we prefer Technology and Discretionary (not shown), over the other cyclical sectors.
While the path of least resistance is still higher in all these sectors, leadership looks increasingly like it's shifting back in favor of Tech over the cyclical groups.
And here's a snippet from a scan we run internally.
This simply looks at the percentage of stocks in the Russell 3000 for every sector which made a closing high in the last week.
Can you spot the standout?
Tech... Lots of green. Nearly a quarter of all Technology names in the Russell 3000 made an all-time high last week, with the other sectors sitting a considerable 10% behind.
That's some gap.
This all suggests that Tech remains an area we want to be overweight and looking to for long opportunities.
Additionally, and as further evidence of healthy risk-appetite, notice how the defensive sectors rounded out the bottom in terms of new highs, particularly over shorter timeframes. Read JC's post about Staples $XLP for more on this.
Moving now to our Industry ETF table.
