We continue to digest the market’s overbought conditions through a market rotation as has been custom for most of 2021. Last week, cyclicals and energy stocks were sold-off, while tech stocks shined. Today, much of this trend was reversed. Another way it’s manifested is the S&P 500 (SPY) making new highs today, while the Russell 2000 is now down 5% since November 8. Today’s commentary will cover our gameplan for dealing with this shift in market behavior, and provide updates on the 2 bearish items discussed last week. Read on below to find out more….(Please enjoy this updated version of my weekly commentary published November 22th, 2021 from the POWR Growth newsletter).
First, let’s take a look at the past week:
The past week’s price action also exemplifies the change in market conditions. Over the past week, the S&P 500 gradually made its way before breaking out to new highs today morning on the news that Fed Chair Powell would be renominated by President Biden.