US Industry Groups by Highest RS Score
Technology sector groups were the among the strongest movers this week, with Semiconductors ($DJUSSC) and Software ($DJUSSW) rising to the top of the Industry Groups Relative Strength (RS) Rankings, while the Computer Hardware ($DJUSCR) group gained +32 RS points to move up to 13th place overall.
This can also be seen on sector level with the XLK Technology ETF strongly outperforming the rest of the sectors this week with a +4.52% gain and closing above both of the September and October highs, and also moving to within a percent of the July all time high.
A note of caution though is that while the leading groups have had strong moves, most are currently still in Stage 3 ranges, and so we need to remain vigilant, as breakouts to new highs from Stage 3 can quickly turn into UTADs (Upthrust After Distribution) if they fail, which is the opposite of a Wyckoff Spring. So, while we are seeing positive price action so far since the recent swing low, and it may continue with Stage 2 continuation breakouts. We just need to be aware that risk is more elevated when in Stage 3.
US Industry Groups by Weakest RS Score
Renewable Energy Equipment ($DWCREE) dropped to the bottom of the RS rankings following earnings results in a few. Plus Gold Mining ($DJUSPM) also dropped closer to the bottom of the rankings, as the majority of stocks in the group had a strongly negative week, and the group moved to new Stage 4 lows.
US Industry Groups sorted by Relative Strength
The purpose of the Relative Strength (RS) tables is to track the short, medium and long-term RS changes of the individual groups to find the new leadership earlier than the crowd.
RS Score of 100 is the strongest, and 0 is the weakest.
In the Stage Analysis method we are looking to focus on the strongest groups, as what is strong, tends to stay strong for a long time. But we also want to find the improving / up and coming groups that are starting to rise up strongly through the RS table from the lower zone, in order to find the future leading stocks before they break out from a Stage 1 base and move into a Stage 2 advancing phase.
Each week I go through the most interesting groups on the move in more detail during the Stage Analysis Members weekend video – as Industry Group analysis is a key part of Stan Weinstein's Stage Analysis method.
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Disclaimer: For educational purpose only. Not investment advice. Seek professional advice from a financial advisor before making any investing decisions.