While the tech sector tries to lead, you can clearly see the Semiconductors (SMH) trying hard to hold onto its 50-week moving average… and it must hold there!
That said, I am thrilled to say that the Retail Sector (XRT) has taken the lead in the market.
I am sure most investors are shocked about the Retail Sector ETF (NYSEARCA: XRT) doing so well with tariff news, high interest rates, real inflation still nuanced and consumer sentiment declining.
Nonetheless, we can thank beauty or lipstick consumers and along with that, my focus, the Vanity trade.
Fabulous earnings this past week from ULTA, E.L.F. Beauty and Nu-Skin.
Take that Nvidia!
The domino effect from the diet drugs will only continue to grow while waistlines shrink. This trend is in infancy.
Meanwhile, my overall sentiment is that:
The “Inside” sectors:
- Transportation (IYT) has weaknesses which is notable.
- Regional Banks (KRE) is showing stress.
- Retail (XRT) is neck-and-neck in strength with semiconductors.
What does that all mean?
Consumers have not given up, while the growth stocks remain the story.
CAVEAT-should the transportation sector or banks fail further, and we see it in mainstream headlines, here comes the next correction (which we believe would be a buy opportunity).
As for the rest of the Economic Modern Family, small caps IWM are wedged between the 50 and 200-WMA.
Biotechnology (IBB) cannot seem to get out of its own way.
Meanwhile, Bitcoin had an interesting week as well.
Technically, after new all-time highs, Bitcoin is consolidating with a lot support down to 98-100K.
By week’s end, we saw options right leaning slightly bearish with
$359 million in outflows.
We are still quite bullish and will be buyers of a dip.
Our IBIT position from $44, we sold at $59.00
We are now looking for a reentry.
The sentiment as a legitimate store of value is changing.
The Bitcoin Conference is over with the biggest takeaway that J.D. Vance and President Trump both own crypto and believe it can help everyday people.
For this coming week, we are looking for
October 2022 versus April 2025, if similarities remain:
- Gold to silver ratio could erode further favoring silver (a move over $34).
- The long bonds could be bottoming (Fed comments on considering a rate cut is all that is needed)
- SPY could chop until late this year-still predict a higher close than 2024 of about 3-4%.
- CAVEAT-the dollar-just broke a huge long-term support level, which we have only seen twice in the last 14 years. 2011 Government shutdown, US downgrade and 2020 Covid. We do not know what this actual catalyst for the dollar breakdown is, but if I had to make a guess, I’d say foreign countries are selling and not buying the dollar. Not to mention the US is still rifled with high debt, high spending, high interest rates and administration confusion on tariffs
As for the rest of the Family, keep eyes on transportation, regional banks and semiconductors.
Retail is a winner, but to remain so, the other members of the Family must stay in the game.
Twitter: @marketminute
The author may have a position in mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author and do not represent the views or opinions of any other person or entity.
