Tackle Today: Defensive Sectors are en fuego
April 13, 2022
«Utilities Lead the Way.»
Traders,
Defensive sectors like consumer staples, health care, and utilities have been on a tear. Here are two implications.
① First, we’re not seeing a mass exodus from all equities. Instead, traders are shifting from aggressive sectors to more defensive ones. It’s not that they hate stocks. They hate certain stocks (I’m looking at you, technology). Consider this an excellent example of sector rotation.
② Second, leadership from defensive sectors, though better than no leadership at all, doesn’t exactly inspire confidence in a bull market.
Combine that with yesterday’s message on the S&P 500 cracking the 50-day moving average, and there’s a reason for caution here. The chart below demanded at least a brief mention of the inflows to sectors like utilities. The steady stampede has been record-setting and reflects just how insatiable appetite has been for the higher dividends and greater stability of utility stocks. Take a good look at XLU to see what all the fuss is about.
Video of the Day: Understanding Market Sectors
In this Coaches Show segment, Coaches Noah Davidson and Gino Poore talk about how market sectors can be changed by current events.
Chart of the Day: Utility Sector Sees Record Run
According to Jason Goepfert of @SentimenTrader, “this is one for the record books. More than half of Utility stocks have hit a 52-week high on an average day over the past 10 days. That’s never happened before, at least since 1952.”
Today’s line up
Traders Lounge 11 AM EST
Join the coaches in this live lounge, ask questions, discuss ideas or just sit back and listen to veteran traders discuss market conditions.
The Coaches Show Replay
If you missed last night’s episode where Coaches Frank Martin and Gino Poore talked about Reversals or would like to watch it again, check it out here.
Halftime Report 12:30 PM EST
The Halftime Report starts at 12:30 EST and covers what news is driving the market, chart analysis from the movers and shakers of the day, and fun in a way that only Matt and Tim can deliver.
Trade Masters 7:00 PM EST
Every Wednesday at 7 PM EST join us on the Trade Masters where two Coaches go head-to-head to see who can find the best trading setup.
Cash Flow Condors MasterMind Group 8:30 PM EST
The Condors for Cash Flow system is a high probability option selling strategy designed to generate passive income over time. Join us tonight to go over next month’s orders.
Trading Justice 471: Implied Volatility
In this episode of the podcast, Matt brings on Tyler Craig from Tackle Trading to discuss why implied volatility matters to options traders.
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