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As I was writing my heading I contemplated I could be writing in a week or two about ‘Cold Sectors’ as markets are fickle.
But for now they are performing as discussed in last week’s review. So let’s briefly recheck all the same charts and see what has happened in the few days. We are especially interested in the oscillator.
Discretionary:
Has eased off in an orderly fashion:
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Energy:
As has Energy – but watch the oscillator does not go too far below zero:
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Health Care:
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Health Care has gone into a range trading pattern – it has lost momentum but can still make decent size moves. But I would only watch this sector not stalk it.
Industrials:
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Industrials looks quite strong as at this stage it could form a classic wave four retreat and move higher in the coming days. Worth watching.
Telecommunications:
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I doubt that in the short term this sector can gain new traction.
The sectors not covered above – Financials, Materials, Staples - are in a range trading pattern. They lack momentum and as they form over 50% of the All Ords that is one reason why our market has reached a midterm high and is vulnerable to profit taking
Enjoy the ride
Tom Scollon |