The Nasdaq is stronger than the S&P and Dow and is at the top of its bullish trend channel

The  S&P and DOW are in the middle of their bullish trend channels while the Nasdaq Composite is at the top of its bullish trend channel. It is likely that the Nasdaq will drop towards the bottom of its channel. Of course, it’s possible it could continue to rally. But prices have been contained in this channel, without exception, since the beginning of the year. The prudent move is to make your protective stops tight so as to lock in most of your profits. The Nasdaq led the market higher from its June 24 low, now it looks like it will lead it lower.
The Stock Sector Relative-Strength Table shows widespread strength with just a few weak spots. The Technology Group was strongest of the four groups while Consumer Staples was the weakest. Only semiconductors and telecommunication services were flat; the other five sectors within the Technology Group has solid increases in relative strength. There was widespread strength in the Cyclicals Group as well. The only weak spot was in the Real Estate and related Building sectors. Basic Materials lost strength for the seventh straight month and nine out of the last ten months. This mirrors a lack of pricing power in the overall economy. If the economy was growing faster, various parts of the economy would be able to raise prices.

Here’s the Relative Strength Chart of the Technology Hardware Sector:technologyHere’s the Relative Strength Chart of the Real Estate Sector:real_estate

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