Last week's sector update noted that "I will need to see the weakness among Technology shares spread to other growth-oriented sectors before concluding that the bull is ready to roll over in any meaningful way." As we can see from the chart above, that weakness did indeed occur, as we saw reduced Technical Strength among Materials, Consumer Discretionary, and Energy shares.
Recall that Technical Strength is a quantitative measure of short-term trending, with sector values ranging from +500 (very strong uptrend) to -500 (very strong downtrend). Values between -100 and +100 suggest a non-trending environment.
Here is how the sectors broke down as of Friday's close:
MATERIALS: -80
INDUSTRIAL: +120
CONSUMER DISCRETIONARY: -80
CONSUMER STAPLES: +60
ENERGY: +20
HEALTH CARE: +220
FINANCIAL: +240
TECHNOLOGY: -40
INDUSTRIAL: +120
CONSUMER DISCRETIONARY: -80
CONSUMER STAPLES: +60
ENERGY: +20
HEALTH CARE: +220
FINANCIAL: +240
TECHNOLOGY: -40
Note that most of the sectors are in neutral trending mode, and none are as yet registering downtrend signals. That is telling us that, so far, the market pullback has been a correction in the bull swing that we've had; not a reversal of overall market trend. That is also consistent with the market perspective recently posted.
I will be watching closely early in the week to see if the market's growth themes and sectors can reassert themselves. As always, updated market indicators will be posted via Twitter before the market open (follow the tweets here). I'll also be posting a general indicator review later in the day.
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