There's No Nation Like Rotation

 

An abrupt rug-pull this morning in hot momentum tech darlings, like NVDA , and even AMD AAPL TSLA, among others, is applying pressure to the bull thesis for continued sector rotation to keep this market uptrend afloat headed into the FOMC next week. 

 

Specifically, the small caps, financials, insurers, even a few builders, are not only ignoring  the tech selling but are perhaps benefitting from that capital seeking a different home. Tech has been on an epic bull run, so a few sharp shakeouts here and there should be expected. Of course, the timing of it is always uniquely difficult to pinpoint, to the chagrin of bears for a while now. 

 

But even they may get a respite for a few days in the form of a QQQ pullback to test some potential support levels below. In the meantime, we are putting in the work to ferret out some under-the-radar long setups for Members in the sector rotation beneficiaries. For as long as rotation persists, there should still be viable opportunities. 

 

Also note the QQQ (ETF for the top 100 stocks in the Nasdaq by weight) has not tested (precisely) its 50-day simple move average (dark blue line) since early-December 2016. Indeed, that long overdue test now seems likely.