Tackle Today: Analyzing the Current Market | Tackle Trading
Tech selloff or something bigger?
Markets are down to start the week after a very volatile week last week. However not everything is down in a broad-based selloff. Sectors such as Energy, Health Care, Staples and Utilities are all holding their own. We have seen this pattern in recent weeks. The broad market sells off led by tech, but other areas of the market show relative strength and even rise in the face of market downward pressure.
We have seen these short-term rotations out of tech several times this year. Inflationary/higher yield worries arise and tech and other select areas of the market selloff. Then for whatever reason those “worries” fade away only to resurface down the road. That has been the pattern in 2021 in technology.
At times, such as last week, because the indices are weighted so heavily in tech the volatility caused by a tech selloff bleeds over into other areas of the market only to have those areas of the market stabilize quickly. For example, even with all the market volatility in the last week Energy and Finance and relatively unchanged.
It is not only a stock pickers market in finding trade setups but it is a stock analyzer’s market as well in determining the general patterns and how you are going to trade them.
We will be here for you all week in our live programming in breaking down the action! Have a wonderful week and email us at [email protected] if you have any questions.
Chart of the Day
XLE Weekly Chart
While the broad markets have been rocky many areas of the market have quickly stabilized after last week’s volatility. While market volatility can always bleed over into the market as a whole (as seen last week) at least for now we are seeing this “fear” exist in only certain areas of the market.
Video of the day
Understanding the Vix
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Originally published at https://tackletrading.com on May 17, 2021.