The Stock Market is Bullish But the Sector Report Shows Weakness

The DOW, S&P and Nasdaq all moved strongly higher Thursday and Friday. All three
have broken past the mid points of their prior drop. This puts the market back
on a short-term bullish stance. It never left the medium and long-term bullish position. Adding to the bullish stance was that there is no indication of selling pressure. All three indexes closed at the day’s high on Friday. Selling pressure is only perceptible and meaningful when it pushes the price lower at the end of the trading session.

Our Relative Strength Stock Sector Table shows pervasive weakness across the board. The Cyclicals and Technology groups have lost so much strength that they are now in negative territory. The defensive Staples Group was almost flat at -.02%, only the Finance Group gained. The Building Sector was the weakest in October losing 3.8% so far. This dichotomy between the strength of the stock market indexes as opposed to the stock market sectors makes for a difficult market to trade.

Here’s the Relative Strength Chart of the Building Sector:building

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