Awakening The Sleeping Tech Giant:
We have brought up this debate before recently, and the question is still up in the air as to whether technology is just resting or is the strength in the cyclical names over the last one month period transitory? One can see on the chart below, during that one month time period technology is just the fourth best major S&P sector performer of 11. And in front of it are groups tied to the economic cycle like energy and materials, and nipping at techs heels are the industrials too. My belief is that technology is just prudently pausing, and strength often begets more strength. AAPL, basically a proxy for the Nasdaq, is sniffing out a cup with handle pivot of 324.34. AMZN still sits just 2% off most recent all time highs, and MSFT has carved out its own cup with handle trigger of 187.61. If any of these, or perhaps all three break out, FOMO will likely just be getting started with the $8 trillion on the sidelines ready to start a stampede. Capital gets allocated to where it is treated best and with the Nasdaq just 3% off most recent all time highs, and the S&P 500 10% and the Dow 13% off its own peak, do not be surprised when a fresh, well rested Nasdaq comes into contact with the very round 10000 figure.