Sector Rotation and Getting Ready for UP moves

We are still in process of consolidation from all the down moves. We might see couple hundred points up and then couple hundred points down in upcoming days. We have to see the double bottom before I start believing in the start of bull rally.

This way I protect myself from getting whipsawed.

As promised last week, I am going to talk about sector rotation today.
From the below chart, you can see the performance of various sectors for last 65 days.
We can see that GOLD has been leader of the pack and held up very well during the market downturn. No. 2 is semiconductors.

Usually in a market rally, 3 sectors lead the rally pack, Technology, Financials and Transports.
From here we can see that Semiconductors are second ones in terms of Performance.
The key here to find few stocks in the Semiconductors pack.



From the below chart we can see how the performance of Semis have been as compared with $SPX. It has been rising steady so this gives us more confidence to get into the Semis.
The next post will be on how to find the market leaders in Semis or any other leading sectors.


$SOX:$SPX - Daily Candlesticks: "