{"id":2197,"date":"2024-03-17T00:06:27","date_gmt":"2024-03-17T00:06:27","guid":{"rendered":"https:\/\/businesstriumphs.com\/index.php\/2024\/03\/17\/great-news-this-bull-market-is-expanding\/"},"modified":"2024-03-17T00:06:27","modified_gmt":"2024-03-17T00:06:27","slug":"great-news-this-bull-market-is-expanding","status":"publish","type":"post","link":"https:\/\/businesstriumphs.com\/index.php\/2024\/03\/17\/great-news-this-bull-market-is-expanding\/","title":{"rendered":"GREAT News: This Bull Market is Expanding!"},"content":{"rendered":"
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We have seen just about everything we\u2019ve needed to see to confirm this powerful secular bull market advance since the beginning of 2023. There was really only one thing missing and it\u2019s not missing any longer. I\u2019ll get to that in a minute.<\/p>\n

But let\u2019s look at the most aggressive sector in the stock market and let\u2019s evaluate the growth vs. value trade that has characterized and driven a tremendous move higher in U.S. equities.<\/p>\n

Technology (XLK):<\/strong><\/p>\n

Semiconductors ($DJUSSC) have been the lifeblood of technology\u2019s leadership and technology represents nearly 30% of the S&P 500 now \u2013 thanks in large part to the huge advance in technology shares. After a remarkable 200% advance in semiconductors over 15 months, we\u2019ve seen the DJUSSC cool off a bit, which began with the bearish engulfing candle I pointed out one week ago:<\/p>\n

From the high on Friday, March 8th to the low on Friday, March 15th, the DJUSSC lost approximately 10%. That had an obvious impact on technology stocks in general, which lagged most sectors last week.<\/p>\n

The very ugly bearish engulfing candle, together with the HUGE volume, is not to be ignored. It \u201ccould\u201d represent a major top in this group for awhile, which isn\u2019t a bad thing. We shouldn\u2019t expect the DJUSSC to triple every 15 months, that\u2019s not sustainable. But if it pauses in the near-term, it\u2019s likely to have a significant effect as many of its component stocks are represented in both the S&P 500 ($SPX) and the NASDAQ 100 ($NDX). The group is much more heavily represented in the $NDX. Semiconductors represents nearly 22.86% and 9.76% of the $NDX and $SPX, respectively. While there\u2019s plenty of growth stocks in the S&P 500, the NASDAQ 100 is much more heavily impacted by growth stocks. That\u2019s why I like to follow the $NDX:$SPX ratio. It\u2019s a \u201cgrowth vs. value\u201d ratio that provides us one look at the risk environment that we\u2019re in. When the ratio goes up, we can typically conclude that the market environment is \u201crisk on\u201d, which usually leads to higher stock prices. A falling ratio, however, can signal \u201crisk off\u201d, which would mean more caution. Here\u2019s where we currently stand:<\/p>\n<\/p>\n

During the summer of 2023, the $NDX:$SPX ratio declined and this \u201crisk off\u201d signal resulted in a 10% correction as the benchmark S&P 500 followed suit to the downside. But look at the last 3 \u201crisk off\u201d readings in the $NDX:$SPX ratio. The S&P 500, for the most part, has kept gaining ground, especially over the past two months. What\u2019s changed?<\/p>\n

Well, thanks for asking, because this was the missing ingredient in the secular bull market in 2024. Let me show you what\u2019s changed. It\u2019s called BULLISH ROTATION:<\/p>\n

XLI:$SPX<\/strong><\/p>\n<\/p>\n

XLF:$SPX<\/strong><\/p>\n<\/p>\n

XLE:$SPX<\/strong><\/p>\n<\/p>\n

XLB:$SPX<\/strong> <\/p>\n<\/p>\n

Over the summer months, when we turned \u201crisk off\u201d, the proceeds from selling those aggressive sectors simply left the market, it didn\u2019t rotate to and create bullishness in other sectors in the market. You can see that by simply following all of those red directional lines for each of the 4 sectors shown above. This time is different and the above relative sector charts help us visualize the difference. <\/p>\n

I believe technology will be fine in time, but a period of underperformance wouldn\u2019t be a bad thing at all. In fact, the rotation is creating tremendous opportunities in other areas of the market. You need to recognize this shift now, because it\u2019s increasing the likelihood that our current bull market run may only just be beginning.<\/p>\n

In Monday morning\u2019s FREE EB Digest newsletter article, I\u2019ll be featuring a company (outside the technology sector) that recently broke out and looks poised for significantly higher price down the road as money has been pouring into its sector. You can CLICK HERE<\/a> to sign up for this FREE newsletter with your name and email address. There\u2019s no credit card required and you may unsubscribe at any time.<\/p>\n

Take advantage of this rotation!<\/p>\n

Happy trading!<\/p>\n

Tom<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

We have seen just about everything we\u2019ve needed to see to confirm this powerful secular bull market advance since the beginning of 2023. There was really only one thing missing and it\u2019s not missing any longer. I\u2019ll get to that in a minute. But let\u2019s look at the most aggressive sector in the stock market […]<\/p>\n","protected":false},"author":0,"featured_media":2198,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-2197","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-stock"],"_links":{"self":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/2197","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/comments?post=2197"}],"version-history":[{"count":0,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/2197\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media\/2198"}],"wp:attachment":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media?parent=2197"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/categories?post=2197"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/tags?post=2197"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}