The $QQQ Nasdaq entered correction territory, falling by more than 10% compared to its recent all-time high, but some of the key cyclical sectors remained relatively stable, with consumer-focused companies holding up especially well. Besides the euphoric sentiment in the tech sector, the troubling global COVID developments, the Brexit chaos, and the lack of a U.S. stimulus deal all weighed on risk assets, but domestic stocks are still in a very strong position from a global perspective. Friday’s session gave hope to bulls that a short-term bottom is near and that the “rotation” into cyclical issues will continue. While bulls are clearly not out of the woods yet, as Russell 2000’s relative weakness is still a bad omen for stocks. However, the fact that industrial, financials, and energy-related issues all finished in the green is a positive sign for the coming weeks. Look at the chart for critical levels.
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