Tight Knit Up Top:
Below is the chart of the one month returns for the 11 major S&P sectors. Bulls have to be pretty excited about the foursome up on top of the leaderboard, perhaps not so much for the energy group. But that group has been decimated, but the sectors in the 2-4 spot are just what growth investors want to see. The XLE is still lower by more than 35% in 2020 thus far, but showing more consistency the XLC and XLY are 3 and 6% thus far this year, while the XLK is HIGHER by more than 3%. As many declare their frustration that a limited number of stocks is pushing benchmarks higher, and by the way that number is expanding by the day, to me it makes it easier to spot where to deploy capital. Sure it could reverse in a rapid manner, or it could continue to linger for many months or years. No one knows, and it is why I favor technical analysis, as it will keep you on the train until it derails or malfunctions. The more investors fail to recognize the rally, the longer the ride ensues.