Technology Sector Shows Improving Relative Strength

Today, we're continuing to give special emphasis to the new encouraging trends in the Financial and Healthcare sectors, while continuing to give emphasis to good action in Industrials and Materials.  Also, Technology continues to offer good solid progress.  You can see the Technology sector's short-term and long-term relative strength trends in the charts below.

In the broad market, you can see below that the percent of stocks above their 200-day moving average has moved up to the line that has tended to mark the "as good as it gets" category. 

As you are well aware, our Asset Allocation Model is now showing that both Monetary and Valuation are as powerful as they are capable of being, which is a powerful support from any weakness, and a strong catalyst to bullish forces.  However, there is one tiny "fly in the ointment" that is catching wide attention, which is that our Psychology Composite is showing that the traditional smart people are a little more cautious and that the traditional dumb speculators are a little to bullish.  But count them up - two powerful bullish forces on one side of the rope, and tugging on the other end is only one force, and even that force is not as strong as it once was.

That's the internal story that the market is telling us today.

To view today's complete Weekly Sector Report, click here.

Don Hays & Nicholas Warf

Please see important disclosures at the bottom of this page.