Hey, Ross here:
Friday was ugly.
Big tech took a big hit, and the S&P 500 fell more than 2%.
But before you write off this market, take a look at what happened over the full week.
Chart of the Day
Source: Scott Brown
This chart shows last week’s gains and losses across the 11 major stock market sectors.
Nine finished up at least 1%.
Healthcare gained 3.1%. Materials rose 2.79%. Even consumer discretionary – businesses that depend on people spending beyond the basics – gained about 2%.
The only losers were tech and communications.
Yet the S&P 500 finished the week DOWN 0.58%.
How? Those two losing sectors include some of the biggest stocks in the index. Their size gives them far more pull than the average company.
So the index fell even as most sectors gained.
Now look at how much room big investors may have to buy.
The blue line tracks how heavily investors are positioned in stocks compared with readings since 2016.
Higher means more heavily invested by past standards. Lower means less.
The latest reading is well below the September peak circled in red.
So big investors have cut back their stock exposure.
But look at WHERE stocks are still rising.
Nine sectors gained last week despite that pullback. Healthcare and materials led the way.
If funds start adding to their positions again, that money doesn’t have to go back into tech.
It could give these emerging leaders even more buying power behind them.
Insight of the Day
The selloff is hiding strength in the rest of the market.
When the biggest names fall hard, they take up all the attention.
Traders start asking when those stocks will bounce. They watch the same charts and wait for the same names to recover.
But the next good trade may already be moving somewhere else.
That’s what I see in this market.
Money is moving beyond crowded tech stocks.
Other sectors are gaining ground, and I’m actively looking for places to put new money to work.
The opportunity isn’t just in beaten-down tech stocks bouncing back.
It’s in stocks that could take the lead while traders stay glued to the old winners.
And as that second chart shows, institutions have plenty of room to add to their positions before getting back to September’s levels.
If they put more money to work in these emerging leaders, that could give those stocks a much longer run.
Large funds can spend weeks building a position. I want to get in while they still have a lot more buying to do.
Finding those emerging leaders starts with knowing where money is moving.
In this morning’s live YouTube market breakdown, I walked through what I’m seeing across the market and the opportunities I’m watching as we head into election week.
If you missed it, you can watch the replay now and see how I’m approaching this market.
Click here to watch the free replay.
Customer Story of the Day
“Best service available, and I have tried them all.
Ross is the only one who spends his time trying to TEACH you how to do it rather than telling you buy this sell that.
It's like the old saying, "Give a man a fish you feed him for a day, Teach a man to fish, you feed him for life."
As a lifetime private trading club member I would Highly, Highly recommend TA to anybody, and I have recommended it to several of my friends and family.”
Embrace the surge,
Ross Givens
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