• 21 mins Venezuela’s Gold Reserves Are Reaching Critical Levels
  • 16 hours Brexit Woes Weigh On The British Pound
  • 17 hours Forget Turkey, This Is The Biggest Threat To European Finance
  • 18 hours There’s No Hiding From Google
  • 19 hours Turkish Lira Bounces Back After Qatar Bailout Pledge
  • 20 hours What Happens If Tesla Goes Private?
  • 22 hours China's Most Powerful Weapon In The Trade War
  • 1 day Can The S&P 500 Shake Off Negative Sentiment?
  • 2 days Standards Go Out The Window As Employers Struggle To Fill Jobs
  • 2 days The Two Trillion Dollar Markets Amazon Hasn’t Conquered
  • 2 days Digital Supermodels Outperform Humans
  • 2 days France Could Lose Billions In EU Trade Route Redirection
  • 2 days Beer Giants Are Striking Out With Millennials
  • 2 days What Is Bakkt And Can It Take Bitcoin Mainstream?
  • 2 days Tesla’s Board Delivers A Stern Message To Elon Musk
  • 3 days Bitcoin Could Challenge Gold As Major Asset Class
  • 3 days Google In Talks With Tencent Over Cloud Business
  • 3 days Tech Giants Charge Deeper Into $8 Trillion Healthcare Industry
  • 3 days Lockheed Stock Soars On $480M Pentagon Contract
  • 3 days Ontario Moves To Slow Cannabis Drive



We are financial market enthusiasts using methods expressed by the Gann, Hurst and Wyckoff with a few of our own proprietary tools. Readtheticker.com provides online…

Contact Author

  1. Home
  2. Markets
  3. Other

Sector Trends Reveal Market Strength

Sector relative strength easily shows up the wave strength behind the market. If you can judge what folks are buying you can determine the risk on or off mode of the market.

This sector rotation chart shows the stock market cycle and the economic cycle.

Economic Cycle

1) Stock market bull cycle favors SPDR sectors: Basic Materials(XLB), Industrials(XLI), Technology(XLK)

2) Stock market bear cycle favors SPDR sectors: Utilities(XLU), Consumer Staples(XLI), Health Care(XLV)

At readtheticker.com we have combined the above into two custom indexes: (1) RTT Product Index (@RTPRD) and (2) RTT Defensive Index (@RTDEF).

To determine the pure risk on or off market we divide @RTPRD by @RTDEF, or risk stocks with defensive stocks, and then review with basic technical analysis. Look out for higher highs, lower lows, divergences, etc.

For example, the SPY (SP500 Etf) sideways pattern during May 2011 was not likely to break out higher as folks brought more defense stocks versus risk stocks, and the SPY low of March 9 2009 was always going to reverse as folks starting to nibble at risk stocks (no new low with the @RTPRD/@RTDEF line).

Knowing if the true risk on or off market is active allows the investor to increase or decrease exposure to the market.



Back to homepage

Leave a comment

Leave a comment