US markets have gone through serious pullback after making a new all time highs in most indices in the month of September, but in total 13 trading days most had sharpest pullback which we have seen , here is the tabulation of last 13 days .
Nasdaq Down11.87%
SOX Down 10.44%
S&P 500 Down 8.24%
DOW Down 5.86%
IF you factor 13 days of trading, one can see the ferocity of this pullback.
IF we look @ RSI, most are deep in oversold area as listed below :
XLE 39.91
Nasdaq 42.09
S&P 500 42.74
SOX 46.78
DOW 46.90
IWM 50.09
GLD 51.87
JETS 55.15
TAN 57.52
Seeing Nasdaq @ 42.09 is a real surprise.
I do have some positive numbers also and it is in above 50 DMA category :
DJIA
IWM
TAN
GLD
There are 2 positive which is worth noting Russell 2000 & DOW both are contrary indicator of this selling.
TAN has been the strongest sector, which has surprised many and me.
IF you further look @ carnage AAPL has lost 22% which is in bear market which kicks in @ 20% pullback.
OK.....any further positive news...YES....
Vaccine for COVID-19 is making much faster progress than anticipated.
TIK TOK has been approved for Oracle partnership with Walmart joining with Bytedance.
TIK TOK news may pull us out of this 13 day trading slump....
Which sector will outperform in this leg up is a very challenging question, IF vaccine gets more positive press then all laggards will move UP sharply.
IF TIK TOK news is the only catalyst then whole technology stocks will get rerated higher, sentiment will improve which should give lift to overall market.
Based on recent pullback, it is clear that expensive techs are being sold to book profit.
SO.. give your portfolio a second look and analyze why DOW lost the least in this sharp pullback, answer may surprise many.....it is the rotation which is taking hold.
Good luck with your own analysis and comfort level.
BLOG does NOT give buy or sell.
Saleem
2 comments:
Hi Saleem,
Last week: +4.31% (YTD: +73.18%)
Notable Leaders: PSNL ACMR PINS BHVN SQ EAT SWKS
Notable Laggards: VICR HUBS
It was a great week for the portfolio, notching large gains in the face of a sluggish market. I will note, however, that the Russell 2000 had a very nice week also (+2.64%), so the strength was broad-based underneath the biggest stocks which pulled back. I do still worry about some turbulence ahead due to a variety of factors, not limited to election uncertainty and second-wave virus fears. In the end though, any pullback will end up being a buying opportunity, so it's difficult to try and perfectly time any short term moves. To me, the Fed's accommodative commitment for years will have a buoyant effect on the market while economies gradually improve from the covid-induced downturn.
Holdings: EAT AVLR PINS HUBS MTCH HCAT PSNL GM QRVO HUYA SQ ELF VICR BHVN CHGG, cash 0.0%
Stocktrader
Hi Stocktrader,
Last week Down 2.95%
YTD UP 41.60%
Saleem
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