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The charts, graphs and comments in my Trading Blog represent my technical analysis and observations of a variety of world markets...
* Major World Market Indices * Futures Markets * U.S. Sectors and ETFs * Commodities * U.S. Bonds * Forex

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...If the dots don't connect, gather more dots until they do...




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Wednesday, May 14, 2014

SPX vs Major Sectors: Stock Market Weakness Ahead?

The following 11 1-Year Daily charts show the 9 Major Sectors, plus Housing and Biotech.

You can see that Technology (XLK), Industrials (XLI), Materials (XLB), Energy (XLE), and Consumer Staples (XLP) have been the strongest performers, of late. The laggards have been Housing (XHB) and Biotech (IBB)

The next 11 1-Year Daily ratio charts show the relative strength/weakness of each of these sectors compared with the SPX.

What I notice immediately on these is the relative weakness of Cyclicals (XLY), Financials (XLF), and Housing (XHB), followed by Biotech (IBB). Unless we see a firming up and buying begin in these 4 sectors, we may see a general weakness creep into the stock market, in general...ones worth watching going forward.

The accumulation we've seen in 2-5-10-30-year bonds of late, and particularly today (Wednesday), may be an attempt by the institutions/market makers to lower interest rates as a precursor to, potentially, stimulate buying in these sectors...so, bonds/rates are also worth tracking over the next weeks/months, relative to these and all sectors...see Sectors vs 30-year bond ratio charts at this link and on the last set of 1-Year Daily ratio charts below.