Sector Rotation

Sector Rotation Alert 

With some sectors up huge and others falling off a cliff, we can equate this movement in stocks to Sector Rotation. What is sector rotation? It's when you see huge money like funds leaving a basket of stocks, and being put into other stocks. This could shape the way the market trades over the next few months or years. It is VERY important to recgonize when sector rotation takes place. You don't want to be the last one to realize -- aka the BAGHOLDER!
Today's heatmap is pictured below, let's get into some of the details....

FANG Stocks --> DEAD 

There is no question that the momentum moves known as the FANG stocks, Facebook, Amazon, Netflix & Google, led us up the past year or so.  These high-beta techs were the strongest in the market with every dip bought in the past. Now? The market is up huge the past two days, and they're being sold off. We can look at this as major funds liquidating their positions to free up capital to buy new stocks. 

The BANKS --> ALIVE!

The Banks have absolutely taken off in the past two days. I have not seen them move this quickly since the financial crisis. Granted, this is a dramatic effect after the election, but there is without question money flowing here. Bank of America breezed through $18 which was a FOUR YEAR pivot high. I'd say something's changed here folks.
 

Healthcare --> ALIVE!

Healthcare stocks have been taking off. Trump says he wants to repeal Obamacare in his first 100 days, releasing healthcare stocks from the confines of the program. This would set them back free into the wild of a competitive market place, where only the strong survive folks!

Biotechs --> ALIVE!

Clinton was expected to go to war with these companies over their individual drug pricing, where they make the bulk of their revenue. Once it was confirmed she was out, these bad boys started flying. Here's Regeneron below, who has gone from $325 to $430 in 5 days, not too bad. 

Emerging Markets --> DEAD!

Trump gives the markets fear of a trade war. This would greatly hurt the nations that depend on the US to trade. This emerging markets ETF EEM tells the story. 

Defense Stocks --> ALIVE!

It's no secret Trump wants to build up the military. A lot of big buyers flowing into these stocks. Here's General Dynamics below:

Oil & Gas Stocks --> ALIVE!

Trump’s victory will perk up the country’s stagnant drilling boom by making it easier to build pipelines that unlock areas rich in oil and gas. VLO below:

Renewable Energy (Solars) --> DEAD!

The prospect that the president-elect would roll back years of Obama administration policies buoyed investors in fossil fuels companies Wednesday/Thursday—while sending shares of top wind and solar power firms tumbling. NEE below:

Mining Stocks --> More ALIVE than EVER!

Trump really wants the blue collar jobs booming all over the country. He's ready to repeal environmental regulations to make it happen. Here's a WEEKLY of JJC which is a Copper ETF. What a move!

Now -- let's make some MONEY!


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