US stock market has entered a phase which is extremely difficult to navigate.
Many cross currents exists
US stock market verdict is loud and clear....technology is not hot anymore, Energy & restart are in demand.
US stock market goes through these phase for an extended period of time.
XLE is an undisputed king of the pack now and sporting a RSI of 78.26 as of Friday's close, energy stocks are further higher in Toronto in today's trading...thus RSI is even more stretched...XLE is @ new 52 wk high and oil is further UP today although slightly which is 7 year high....
Since Energy stocks & Natural Gas stocks are so popular, everyone is piling in..which becomes scary in a way....but popularity can keep building on its own strength, strength begets more strength...Wall Street is known for excess beyond sanity....
How high energy & natural gas stocks will go, I have no idea.....but I a have booked my profit for now....
XLF financials are a distant number 2 in popularity with an RSI of 59.66.....
JETS or Airlines is number 3 in popularity with an RSI of 57.34
On the contrary Nasdaq is 2nd last / weakest in my universe with an RSI of 40.26
TAN Solar is the weakest with an RSI of 32.49
It is extremely difficult @ this stage how to position in US stock market, I suggest waiting few days / weeks to see how the sectors play out...this is exactly what I am forcing myself to do currently...why do I say forcing ?
Forcing because I knew for a long time that Energy will take off big time and it has....In Energy stocks I still do not see froth like ZOOM ROKU yet...thus it is difficult to contain my enthusiasm for Energy & Natural gas stocks.....
IF I see slight pullback in energy shares, I may get back in very quickly.....
SO navigate your portfolio with due diligence which is absolutely critical @ this juncture...
Go with the flow which is clearly redefined now.....
Good luck with your own understanding of what may work going forward...
BLOG does NOT give buy or sell.
Saleem
2 comments:
Hi Saleem,
Last week: -2.76% (YTD: -9.03%)
Notable Leaders: PHM AGCO
Notable Laggards: GMBL CXM USER ESTC VERI
It was another tough week with high growth stocks getting crushed in the face of rising interest rates. With Fed talk shifting from "transitory" inflation to how quickly they can raise 3-4 times in the span of just 6 weeks, there has been a major re-think about which stocks can do well going forward. My personal belief is that a 30% growth stock will not be much affected by 0,1,2,3% rates, but the market is doing its own voting at the moment. Many times deep selloffs will last 6 weeks, and so I wonder if we can form a new base here with valuations down so much. I think earnings season will tell us what we need to know: good reports but repeated selloffs will signal more downside ahead.
Holdings: PINS ZIP PLAY FDX ENPH ESTC UPST VERI CXM USER ZENV BMEA GMBL, cash 0%
Stocktrader
Hi Stocktrader,
Last week UP 1.78%
YTD UP 4.28%
Saleem
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