In strong, healthy bull markets, high-beta stocks tend to lead.
These are the riskier, more volatile names—mostly Tech and Discretionary. They're the high-flyers that drive markets higher.
On the other hand, low-volatility stocks are more defensive in nature. Think Consumer Staples and Utilities. They're where investors hide when uncertainty rises.
Right now, the SPHB/SPLV ratio is collapsing to fresh 52-week lows.
When risk-on stocks underperform and defensives take the lead, it's a sign of shifting tides.
U.S. equities are running into a major confluence of resistance after a weak rebound in recent days.
Until buyers step up and show some serious follow-through, sellers are likely to remain in control.
When looking at the most crucial risk-on groups, two sectors are approaching a resolution that could set the tone for the weeks and months ahead.
First, Large-Cap Technology relative to the S&P 500 is teetering just above the lower bounds of a two-year topping formation.
With Tech representing roughly 30% of the S&P, a breakdown here wouldn't just be a sector-specific issue—it could have broader implications for the entire market.
Adding to the concern, Home Construction $ITB, a critical...
Whether you look at Europe breaking out, Gold pushing toward $3,000, or China ripping higher, some of the best opportunities are now found outside the U.S.
This has been the case so far this year.
The Large-Cap China ETF $FXI just hit 18-month highs relative to the S&P 500 $SPY, signaling a potential shift in market leadership.
A trend reversal seems to be in play in favor of Chinese equities.
No one’s talking about it. Everyone’s ignoring these stocks.
The rules have changed.
What worked in previous years isn’t necessarily going to cut it today.
In a market like this, uncorrelated trades aren’t just a hedge—they’re a must for diversification and risk management as leadership shifts across regions and sectors.
Steve and Jason went live yesterday, breaking down their strategies and how to navigate environments like this....