• Investing
  • Stock
Round Table Thoughts
  • Economy
  • Editor’s Pick
Home Stock One MAJOR Concern About Friday’s Rally
Stock

One MAJOR Concern About Friday’s Rally

by June 2, 2024
by June 2, 2024 0 comment
Share
0
FacebookTwitterPinterestWhatsapp

I’m all for a big rally with a hammer printing on the long-term weekly chart, especially at 20-week EMA support. That’s exactly what happened on Friday on the Dow Jones Industrial Average ($INDU). This index of conglomerates had been underperforming other areas of the stock market badly and, on Friday, was on the verge of printing its lowest weekly close since back in January. The April low weekly close was 37983.24 and Friday’s low was 38000.96. So after posting an all-time high weekly (and daily) close at 40003.59 just two weeks ago, the Dow Jones was on the verge of moving to a close that wasn’t too far from a 2024 low weekly close.

Then the buying happened:

During secular bull market advances, it’s important to hold onto 20-week EMA support and the Dow did just that. The Dow climbed over 300 points in the last 20 minutes. It was a fantastic finish.

So what’s not to like about it? What’s the opposite of a “silver lining?” Maybe “every rose has its thorn?”

Well, here’s the thorn:

That bottom panel shows that, while the overall market made a HUGE reversal, with the S&P 500 climbing all the way back to where it was early in the week, the XLK lagged WAY behind on a relative basis. Rotation is a part of the game and sometimes, even during solid bull markets, we’ll see money rotate away from technology. But let’s keep one thing in mind. Technology (XLK) represents 29.2% of the S&P 500. Technology represents 49.29% of the NASDAQ 100 ($NDX), while representing just 18.6% of the Dow Jones.

My point here is that if we’re witnessing rotation away from technology, even for just a brief period of time, we should expect to see outperformance of areas without as much technology exposure – like the Dow Jones. And after seeing that Dow reversal off its 20-week EMA, I believe we’ll see the Dow Jones outperform during the month of June.

Join our EB Digest (EBD) newsletter today to enjoy other thought-provoking charts published 3x per week. Find out the sector that LOVES the month of June as I’ll be discussing that in Monday’s EBD. CLICK HERE to start your FREE subscription today!

Happy trading!

Tom

You Might Also Like
  • Precious Metals and Miners Ready to Rally
  • Sector Spotlight: Sector Rotation Says Bull Market in Full Swing
  • Capturing the Momentum Phenomenon – Nvida vs Tesla
  • Stocks Pop Higher as Defensive Sectors Thrive
Share
0
FacebookTwitterPinterestWhatsapp

previous post
Ulta Beauty CEO outlines plans to boost sales after first-quarter slowdown, shares jump 11%
next post
Biden’s wishful thinking vs. Iran’s trail of terror and deceit

You may also like

The Ord Oracle March 21, 2023

March 23, 2023

DP Trading Room: Natural Gas (UNG) Bearish Again?

June 17, 2024

Higher Gold Price Coming, But Investors Must Be Patient

January 30, 2024

Sector Rotation: How to Spot It Early Using Four Tools

February 26, 2025

Be On the Lookout for THIS During Earnings Season!

October 18, 2024

DexCom Stock Rises From the Ashes: A Breakout You Can’t...

January 17, 2025

How to Use Emerging Relative Strength

February 23, 2023

Week Ahead: NIFTY May Stay Vulnerable At Higher Levels; This...

October 7, 2023

Find Great Trading Ideas By Combining SCTR Rankings and RRG

November 10, 2023

Welcome to the Tom and Jerry Markets

May 8, 2023

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Krispy Kreme stock plunges after doughnut chain pauses McDonald’s rollout, pulls outlook

      May 8, 2025
    • Don’t Buy Robinhood Stock… Until You See This Chart Setup

      May 8, 2025
    • UnitedHealthcare sued by shareholders over reaction to CEO’s killing

      May 8, 2025
    • The Unpredictable Stock Market: How to Make Sense of It

      May 8, 2025
    • AMD CEO calls China a ‘large opportunity’ and warns against strict U.S. chip controls

      May 7, 2025

    Popular Posts

    • 1

      Trump-era China sanctions ended by Biden may be...

      June 27, 2024 2,630 views
    • 2

      Walz’s honeymoon with China gets fresh scrutiny as...

      August 9, 2024 2,339 views
    • 3

      Biden appointee played key role in recruiting Chinese...

      June 25, 2024 2,320 views
    • 4

      Shein’s global ambitions leaves some cybersecurity experts fearful...

      July 10, 2024 2,302 views
    • 5

      Harris VP pick spent years promoting research facility...

      August 29, 2024 2,186 views

    Categories

    • Economy (7,009)
    • Editor's Pick (2,066)
    • Investing (538)
    • Stock (2,530)

    Popular Posts

    • 1

      Trump-era China sanctions ended by Biden may be revived under new House GOP bill

      June 27, 2024
    • 2

      Walz’s honeymoon with China gets fresh scrutiny as Harris camp blasts ‘lying’ critics

      August 9, 2024
    • 3

      Biden appointee played key role in recruiting Chinese businesses to Delaware: ‘Longtime friends’

      June 25, 2024
    • 4

      Shein’s global ambitions leaves some cybersecurity experts fearful of Chinese spy threats

      July 10, 2024
    • 5

      Harris VP pick spent years promoting research facility that collaborated with ‘Chinese military company’

      August 29, 2024

    Latest News

    • Krispy Kreme stock plunges after doughnut chain pauses McDonald’s rollout,...

      May 8, 2025
    • Don’t Buy Robinhood Stock… Until You See This Chart Setup

      May 8, 2025
    • UnitedHealthcare sued by shareholders over reaction to CEO’s killing

      May 8, 2025

    Categories

    • Economy (7,009)
    • Editor's Pick (2,066)
    • Investing (538)
    • Stock (2,530)

    Disclaimer: RoundTableThoughts.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2024 RoundTableThoughts.com. All Rights Reserved.

    Round Table Thoughts
    • Investing
    • Stock
    Round Table Thoughts
    • Economy
    • Editor’s Pick

    Read alsox

    Week Ahead: NIFTY May See A...

    May 13, 2023

    Salesforce Falls Out of Favor: Trade...

    May 14, 2024

    Best Way to Capitalize on Election...

    November 9, 2024
    Sign In

    Keep me signed in until I sign out

    Forgot your password?

    Password Recovery

    A new password will be emailed to you.

    Have received a new password? Login here