Recent Triggers In SPY, QQQ Suggest U.S. Markets May Enter Rally Phase
Chris Vermeulen | Jan 22, 2021 04:24PM ET
Recently, our Best Asset Now (BAN) Hotlist generated a new trigger on the SPY (NYSE:SPY) chart. Typically, this type of trigger suggests the SPY is starting a new, potentially explosive, upside price rally. But what really interests us is the potential that the strongest sectoral ETFs may continue to see a much stronger upside price rally as a result of this new trigger.
Recent BAN SPY Trend Trigger
The strength of the BAN Hotlist is not the general market triggers it gives, such as the SPY, Dow Jones or NASDAQ Composite, but instead the ability to align these major market triggers with the strongest performing sectoral ETFs. This allows those using the Hotlist and BAN strategy to take advantage of the best-performing assets in the markets in any market trend. The new SPY trigger, seen on the chart below, suggests the U.S. stock markets may be starting a new upside price trend, which will cause capital to rotate into different sectors. Our simple BAN Hotlist and strategy helps us identify these sectoral opportunities.
QQQ Generates Similar Type Of Breakout Trigger
Traders love when ideas drawn from one chart is corroborated by other charts. As we can see from the chart below, the Invesco QQQ Trust (NASDAQ:QQQ) appears to have confirmed this BAN trigger with a similar type of upside price breakout. This upside move in the QQQ aligns with some of our recent research that suggested the Technology sector had stalled after having been one of the fastest-growing sectors for several months now. We may start to see certain sub-sectors of technology really start to advance faster than the SPY/QQQ – which creates explosive opportunities for traders/investors.
Recently, we published a research article suggesting a lower U.S. Dollar would prompt . Within that article, we highlighted the fact that the Materials, Industrials, Technology and Discretionary sectors had been the hottest sectors of the past 180 days, but the Energy, Financials, Materials and Industrials had shown the best strength over the past 90 days. echnology had fallen/stalled dramatically over the past 90+ days.
Get The News You Want
Overall, we believe the best performing sectors are likely to be sub-sectors of the SPY and QQQ. Potentially, certain components of the Technology, Health Care, Discretionary and Utility sectors. Beyond that type of general analysis, we rely on the BAN Trader system to rank the “Best Assets Now” and tell us when new trade entry triggers are generated. It is very likely that this new SPY BAN trigger will prompt an extended upside price rally across a number of assets over the next few days/weeks.
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