That's right.... so far it's sector rotation eg high multiple tech is getting sold as are small caps etc while banking and defensives are not dropping as much. Plus very wide divergence across the 4 major markets lately. I was surprised by today's choppy markets given nfp big miss. Still staying bearish but like quality tickers like F, my top pick for the year.
Doesn't bother me in the least, since I have a secret edge against you perma-bears, which is time. That's something bears can never beat. As a bull, I'll hibernate while watching you scramble to understand a bull market. I am guessing your 401K is filled with inverses? You really believe in a 20-Y bear case? If so, you are part of the PROBLEM! You are so SAD!
Massive sector rotation explains this weeks moves. I don't know if it last since the XLF has been range bound until today. Its obvious for XLE & XOP to keep going higher. Recently this market has 3 separate modes: Growth (NQ) ----> XLK+XLY+XLC Value (YM) ------> XLF+XLE (Sometimes XLB+XLI) Defensive --> XLU+XLP (Sometimes XLRE+XLV) On Monday the 10yr rate rose a lot but XLK rose anyway -- it was a false move. I noticed on Monday the VIX rose even though the SPY was up a lot so that was probably a tell. I usually use YM as a proxy for the value trade even though it has some tech stocks (CRM, AAPL, etc.) but the last 2 days YM didn't do much and yet the XLF & XLE kept rising. Value crushed growth this week (+8% vs. -3.6%): XLF 5.4% XLE 10.6% XLK -4.6% XLY -2.5% During the sell off XLU went up 2.1% intraday today from the bottom to the top and that seems to be a proxy for the traders who used to use bonds but since the bond market is broken they just use XLU I think. I assume next level panic is buying the US dollar.
S&P sells off a measly 100 points after going up thousands and doom porn gurus say this is the end, here comes the sell off!!!
These guys come out from under a rock every time the market drops a few percentage points. They avoid the thousands of points it goes up in order to catch the 100 points it drops which they usually give right back (plus more) when the market reverses. Unfortunately ET has to endure these people every time the market falls a few percentage points, people who think they are making some hero call. The sad part is the broken clock saying. When one of these noobs finally does call it right they will think they have some sixth sense. Amazingly, these people for all of their hero calls on the market crashing are usually broke.
I get what you're saying but to me it just isn't that deep or complicated. You also have people who think every dip will always get bought up. Sure it often does and it's a much better generally probability than to be a perma bear, no doubt. But at the same doesn't mean you discount every setup that actually has a higher potential to move lower, just because you always have people calling for a crash. The two things really have nothing to do with each other. Maybe you're in the camp that swears there's no way to distinguish pull backs that have a higher probability to go lower than others, than that's fair. Have no interest in trying to prove that to you.