This past February the market was running hot!
Too hot.
We saw some of the most bullish sentiment readings in years. And this sentiment came after a historic rally for equities throughout the 4th quarter last year that couldn’t miss. Everything was working.
But things can’t just go up forever. They need to rest eventually, and reset some of that excessive optimism.
That’s exactly what happened.
Despite some of the growth indexes making new highs, a lot of the most important groups of stocks have done absolutely nothing since February.
Look at Consumer Discretionary, Financials, Industrials and Healthcare trading sideways to down this entire time:
We don’t have bull markets without Financials around here.
Industrials are the sector with the highest positive correlation with the S&P500 of all the S&P sectors.
And Healthcare is a massive component of both the Dow Jones Industrial Average and S&P500.
But it’s Consumer Discretionary where the opportunity stands out the most.
Look at Amazon breaking out to new all-time highs last week. This stock represents over 23% of the entire Consumer Discretionary sector.
And it’s just now getting going…
Meanwhile, Tesla is the 2nd largest component in the Consumer Discretionary Index, representing over a 13% weighting.
After finding support recently near the 61.8% retracement of that entire move from 2019-2021, TSLA is already making new 4-month highs.
Consumer Discretionary is one of the more offensive sectors in the market.
So now that we’re 2 years into this bull market, wouldn’t it make sense for rotation to flow into Discretionaries?
Tonight is our LIVE Monthly Charts Strategy Session for Premium Members of ASC Research.
I’ll be walking through all of the most important trends across assets, including all the major US Stock Market Indexes, Global Averages, all the bellwether stocks, Energy, Gold & other metals, and how the current interest rate market and inflationary pressures are impacting equities.
Of course, I’ll show you my favorite ideas right now and the best ways to play them.
Premium Members make sure to REGISTER HERE if you haven’t already.
I’ll get going LIVE @ 6PM ET.
See you there!
JC
Note: If you’re not an ASC Premium Member, call Mary at +1 (323) 421-7910 to talk about upgrade options or click here to join us RISK FREE.
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