A Backwards Bullish Stock Market Run

The stock market has been bullish since late June. It’s interesting that this is the same date that began the huge dump in bond prices. Normally, strong bullish stock market moves are lead by growth and technology companies. That would make the Nasdaq the strongest, the DOW the weakest with the S&P in the middle. Now, it’s the exact opposite. The DOW is overbought; it has moved above the bullish trend channel. This is a sign of weakness. The S&P is solidly bullish, but it’s most-recent bullish wave has not yet reached the top of the bullish trend channel. The Nasdaq Composite is the weakest; Its upward moves are not keeping pace with the increase of the lows.

My relative-strength stock sector table shows sudden weakness in the financial group; it had been the strongest group a few weeks ago. Perhaps concomitant with Trump’s election and promise to repeal ObamaCare, both the Health and Pharmaceutical Sectors became very weak to the tune of -3.2% and -4% respectively. Another big move was a 4.6% loss in the Aerospace Sector. The Real Estate sector gained a solid 2.3% but the building sector exploded for 4.8% since only the beginning of December.

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