For the second consecutive session the Nasdaq outperformed the S&P 500 and perhaps thats a sign that the benchmarks are graveling for a short term bottom. I still think there is plenty of downside, but perhaps long only’s can have a temporary glimmer in the sun. The Nasdaq saw positive ground Thursday for a nanosecond, and for the week headed into Friday the Nasdaq is lower by 2.2% and the S&P 500 by 2.7%. Technology was easily the best performing major S&P sector narrowly missing gains, as 2 of the 4 FANG names gained ground today. Even AAPL which has been acting better on an overall tough tape in general was close to the UNCH line today. In a facetious manner I thought perhaps it should be viewed as a consumer staple play, of course from a much lower trajectory from say a KMB, with its steady action and it seems like a product customers purchase regardless of the economic environment (of course I am being silly here, humor is in order in these markets!) Below is the chart how it was presented in this Tuesdays Game Plan. Other industries I will continue to keep my eyes on are the homebuilders which with plunging 10yr yields seem to be attempting to find a bottoming process of their own. Other slightly encouraging signs today were the drag the utilities displayed Thursday (only worse performer today were the financials). I have been pounding the table on the need to see some positive divergence with the Nasdaq needing to show some vigor. Prior to Wednesday the S&P 500 outshined the Nasdaq 8 consecutive sessions. Baby steps, of course with incredible discipline.
This article requires a Chartsmarter membership. Please click here to join.