QQQ top holdings Nov 10th

QQQ top holdings Nov 10th

The theme that I had pointed in yesterday’s Biotechs Doing the Heavy Lifting video, in which the stark underperformance of what had for years been the market leading stocks continues today, even at a more alarming pace. It seems that other than a few obscure & relatively unimportant sectors, the strength in the broad market (S&P 500) today is clearly once again attributed to the financial & health care sector. In fact, the leading index throughout this entire bull market, the Nasdaq 100, which actually doesn’t contain any financial companies but is a very tech heavy index, is currently down over -1.6% while the S&P 500 is trading up over +0.25%.

Such stark divergence between these two highly correlated large-cap indices is a red flag in my book & the fact that the former market leading stocks are being taken to the woodshed today tells me to not only stay far away from chasing long-side breakouts by to keep pressing short the select stocks & sectors with the most bearish chart patterns.

The screenshot to the right show the top holding in the Nasdaq 100/QQQ, sorted by market cap. Besides the former market leaders such as GOOG/GOOGL, FB, & AMZN coming under very heavy selling pressure along with the semiconductor sector which I have been highlighting as one of the most attractive shorting opps for weeks now (trading down another 2%+ today).

While some might call this “healthy sector rotation”, I don’t see it that way. In fact, I still believe that the market is most likely on the verge of a major sell-off & barring a major stick-save into the close, QQQ is poised to print a very ominous bearish engulfing candlestick.